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presented  to  the 
UNIVERSITY  LIBRARY 
UNIVERSITY  OF  CALIFORNIA 
SAN  DIEGO 

by 

JUDGE  J.M.   CARTER 


y3. 


Digitized  by  the  Internet  Archive 

in  2007  with  funding  from 

IVIicrosoft  Corporation 


http://www.archive.org/details/bryantstrattonscOObryaiala 


BRYANT  AND  STRATTON'S 

COMMON    SCHOOL 

BOOK-KEEPING; 

'     EHBBACINa 

SINGLE   AND   DOUBLE    ENTRY. 

CONTAINING 

SIXTEEN     COMPLETE      SETS     OF     BOOKS. 

WITH 

AMPLE  EXERCISES  AND  ILLUSTRATIONS. 
FOR  t>k.im:a.e.y  schools  and  A.C-AJ3KM:IEJS. 


H.  B.  BRYANT,  AND  H.  D.  STRATTON, 

rOVWDEBS    OF  THE    INTERNATIONAL    CHAIN    OP    COMMERCIAL    COLLEGES,  LOCATED    IK    TBS 
PBINCIPAL  CITIES  OF  THE  U.  8.  AND  THE  DOMINION  OF  CANADA, 

AND 

S.    S.    PACKARD, 

BISIDENT  FBINCIPAL  OF  THE  NEW  TOBK  CITT  XEBCANTILX  OOIXEQB. 


IVISON,  BLAKEMAN,  TAYLOR  &  CO., 

NEW    YORK   AND   CHICAGO. 

1872. 


Entered,  according  to  Act  of  Congress,  in  the  year  1891,  bj 

BRYANT,  STEATTON  &  PACKARD, 

L:^  tbe  Clerk's  Office  of  the  District  Court  of  the  United  States  for  the  Southern  District  of 

New  York. 


slbotsottpkd  bt 

Smith   &  MoDouqaIi, 

82  &  84  Beekmoa-st 


PKEFACE. 


That  there  is  a  demand  for  a  primary  work  on  Book-keeping,  -which,  while  it 
is  specially  adapted  to  the  comprehension  and  wants  of  a  younger  class  of 
students  at  our  public  and  private  schools,  shall  seek  to  enforce,  in  a  philosophical 
manner,  the  abstract  theories  of  the  science,  is  assumed  by  the  authors  of  this 
treatise,  not  solely  as  the  basis  of  an  apology  for  producing  a  new  book,  but  as  the 
result  of  careful  inquiry  among  teachers  and  educationalists,  not  less  than  a  faithful 
survey  of  the  field  of  literature  compassing  this  end. 

Experience  has  often  proven  that  less  tact  and  labor  are  necessary  in  discovering 
a  want  than  in  supplying  it,  and  the  present  effort  whether  or  not  the  public  may 
pronounce  it  successful,  is  made  in  full  view  of  this  fact  To  state  an  abstract 
proposition,  which  the  unerring  testimony  of  figures  will  render  impregnable  is  no 
difficult  matter ;  but  to  give  vital  force  to  such  a  statement  in  clear  and  satisfactory 
analyses,  whose  sequences  shall  take  a  practical  hold  of  minds  not  schooled  in  the 
processes  of  reasoning,  is  an  undertaking  which  may  well  cause  the  conscientious 
author  to  pause  upon  the  threshold  of  his  well-meant  endeavor.  There  are  minda 
so  constituted  as  to  be  able  to  grasp  intuitively,  and  with  unerring  certainty,  the 
grander  truths  of  a  mathematical  problem,  discarding  alike  the  minor  points  of 
reasoning  and  illustration,  and  the  pretentious  "  rules  "  which,  though  too  often 
but  diluted  axioms,  are  kindly  intended  to  aid  the  faltering  steps  of  the  less  self- 
reliant  ;  but  these  are  the  exceptions  and  not  the  rule ;  and  hence,  experience  in 
teaching  has  shown  us  that  in  the  majority  of  cases,  the  bare  statement  of  a  princi- 
ple, however  fundamental  and  vital,  cannot  be  alone  relied  upon  for  the  thorough 
work  of  instruction.  The  labor  of  a  teacher  is  necessarily  one  of  endless  variety 
and  repetition.  "  Lino  upon  line,  and  precept  upon  precept "  is  the  motto  of  h!i 
profession  and  the  signet  of  his  success.  While  it  is  not  the  privilege  of  an  author 
to  know,  by  actual  contact,  the  individual  wants  of  those  whom  he  aims  to  instruct, 
he  must,  nevertheless  be  possessed  of  a  general  knowledge  of  these  wants,  and 
address  himself  conscientiously  to  the  task  of  supplying  them. 

The  authors  of  this  treatise  claim  for  it  the  distinctive  merit  of  thoroughness, 
both  in  the  statement  and  elucidation  of  principles.  In  its  preparation,  two  points 
were  assumed :  first,  that  the  class  of  students  who  would  gather  instruction  from 
its  pages  were  already  learned  in  the  idioms  of  their  own  language,  no  less  than  in 

3 


PREFACE, 

ttie  ttrndamental  rules  of  Anthmetic;  and  second,  that  the  teachers  who  would 
adopt  it  as  a  text  book>  would  make  themselves  familiar  with  the  general  scope  of 
its  teachings,  no  less  than  the  details  by  which  its  prime  theories  are  enforced.  In 
order  that  a  text  book  should  accomplish  any  certain  result,  there  should  exist  a 
perfect  understanding  between  the  author  and  the  teacher,  each  of  which  has  his 
own  peculiar  sphere  of  labor  into  which  the  other  cannot  enter.  The  author  deals 
in  general  principles  and  their  most  palpable  applications,  without  being  able  to 
anticipate  the  particular  and  varied  wants  of  the  student,  or  to  supply  those  wants, 
even  if  he  knew  them.  The  teacher  on  the  other  hand,  is  the  living  exponent  of 
the  dead  letters  and  forms  which,  to  unpractised  eyes  are  surrounded  with  a  mazy 
mystery  which  can  bo  dispelled  only  by  the  human  voice.  His  is  the  sacred  o£3ce 
of  an  interpreter,  the  duties  of  which  demand  of  him  not  only  a  thorough  apprecia- 
tion of  the  thought  interpreted,  but  an  intimate  knowledge  of  the  bearing  and 
capacity  of  the  mind  to  which  he  discloses  the  hidden  lore. 

In  the  multiphcity  of  exercises  given,  the  teacher  will  find  material  for  an  ahnost 
indefinite  variety  of  illustrations,  and  it  should  bo  his  special  care  that  the  student 
be  not  permitted  to  pass  from  one  set  to  another  without  fully  mastering  the 
subject,  both  in  its  general  and  special  application. 

The  sets  are  short  and  definite  in  their  purpose,  the  object  being  to  keep  con- 
stantly in  view  the  result  of  the  student's  labor ;  for,  while  it  is  true  that  in  no  way 
can  the  science  of  Accounts  be  so  quickly  and  thoroughly  enforced  as  in  showing 
at  once  the  result  of  each  separate  transaction,  as  regards  both  the  persons  and 
causes  affected,  it  is  no  less  so  that  the  fundamental  theory  of  the  science  can  best 
be  made  apparent  by  frequently  exhibiting  the  general  result  of  all  the  transactions. 

The  prominence  which  is  given  to  Single  Entry  will,  we  trust,  satisfy  the  public 
that  we  are  not  prepared  to  enter  into  the  popular  cry  of  authors  and  teachers  that 
no  system  of  Accounts  is  worthy  of  thought  that  does  not  fully  carry  out  the  test 
of  equal  debits  and  credits ;  for  while  wo  are  free  to  express  our  decided  preference 
for  Double  Entry,  we  cannot,  either  in  justice  to  our  own  convictions,  or  the  pre- 
judices of  the  public,  ignore  the  points  of  excellence,  or  fail  to  suggest  such 
improvements  aa  are  deemed  important  to  a  system  which  will  be  used,  to  a  greater 
or  less  extent,  to  the  end  of  time. 

In  short,  it  has  been  the  earnest  aim  of  the  authors  to  produce  a  book  which, 
thotigh  its  external  appearance  would  not  disgrace  the  shelves  of  the  Bookseller, 
its  internal  merits  will  not  permit  it  to  remain  there.  It  is  a  book  designed  for 
use,  and  as  such  is  respectfully  submitted. 

BRYANT,  STRATTON  &  PACKARD. 

18  Cooper  iNSTiTtrrE,  Nkw  Yobs, 
Jul7 1, 1861. 


CONTENTS. 


PART   I.— SINGLE  ENTRY. 

'AGES. 

Abbreviations  and  Characters, n  7 

Plan  of  the  Work,        .        ....        .     "  .        .       .        .  8 

Introduction  to  Part  I.    . ^  11 — 17 

Questions  for  Review, 18 

Set  I. — Initiatory — Showing  the  use  of  the  Books. 

Remarks 20 

Day  Book 21,    22 

Ledger 23—25 

Exercises  for  the  Learner  and  Questions  for  Review  .        .  26 

Set  IL — Retail  Merchandise.     (Prosperous.) 

Remarks        . 28 

Day  Book 29—35 

Index  to  Ledger 36 

Ledger 37 — 40 

Cash  Books            41 — 44 

Statement ...  45 

Examples  for  Practice            46 

Exercises  for  the  Learner    (Second  Series.)        ...  47,    48 

Questions  for  Review 48 

Set  m. —  Wholesale  Dry  Goods.  {Adverse.) 

Remarks 50 

Day  Book 51—54 

Index  to  Ledger         .        .        • 55 

Ledger  .        .        • 56 — 59 

Sales  Book 60 — 63 

Cash  Book     • •        .        .  64,    65 

Bill  Book .  66 

Statement 67 

Examples  for  Practice        .......  68 

Exercises  for  the  Learner    (Third  Series.)     .        .        .        .  69,    70 

Set  rV". — Cabinet  Ware  and  Furniture.     {Prosperous.) 

Remarks 72,    73 

Day  Book 74—77 

Sales  Book         . 78—83 

Ledger 84 — 87 

Casli  Book 88,    89 

Time  Book              , 90 

Statement 91 

Examples  for  Practice 92 

Exercises  for  the  Learner    (Fourth  Series.)        .        .        .  93 — 95 

Questions  for  Review 96 

6 


CONTENTS. 

PART   II.— DOUBLE  ENTLI. 

PAGM. 

IirraoDucTiON  to  Past  II 99 — 102 

The  Sciexce  of  Accounts. 

Theory  of  the  Ledger 103,    104 

Debits  and  Credits              105 

Principles 106 

Questions  for  Review 107 

Set  L — Produce  Business.     {Iniiiaiory.) 

Remarks 110 

Day  Book Ill,    112 

Journal          . 113 — 115 

Ledger       116 — 118 

General  Statement 119 — 121 

Examples  for  Practice 122,    123 

Exercises  for  the  Learner.     (First  Series.)      ....  124,    125 

Set  IL — Grocery  Business.     {Prosperous.) 

Remarks 128 

Day  Book      . 129—132 

Journal 133 — 135 

Ledger 136 — 140 

Balance  Sheet    .        .        .        .      • .        .        .        .        .  141 

Closing  the  Ledger 142 — 147 

Description  of  Balance  Sheet 147,    148 

Examples  for  Practice 149 

Exercises  for  the  Learner.     (Second  Series.)      .        .        .  150,    151 

Questions  for  Review 152 

Set  m. —  Wholesale  Ih-y  Goods.     (Adverse.) 

Remarks 154 

Journal  Day  Book 155 — 161 

Ledger 162—167 

Statement      . 168,    169 

Examples  for  Practice  and  Questions  for  Review         .        .  170 

Set  rV. — Gentlemen's  Furnishing  Business.     (Prosperous.) 

Remarks 172 

Journal ■        .  173 

Cash  Book 174,    175 

Sales  Book 176,    177 

Ledger 178—181 

Exercises  for  the  Learner.     (Fourth  Series.)        .        .  181,    182 

Pbactical  Hints. 

Order  and  Neatness        . 183,    184 

Proficiency  in  Mathematics 184,    185 

To  detect  Errors  in  Trial  Balance 185 — 187 

Resources  and  Liabilities 187,    188 

Exchange 188—192 

Questions  for  Review 192 

6 


ABBREVIATIONS  AND   CHARACTERS 


USED  IN  THIS  WORK. 


ABBREVIATIONS. 


AcH. ....  Account. 
Ani't. . . .  Amount. 
Atis.  . . .  .Answer. 
Apr. ....  April. 
AssH'd. . .  Assorted. 
Aiig August. 

B 

£al Balance. 

B.B. BUI  Book. 

£bls.. . .  .Barrels. 

B.  Pay.. Bills  Payable. 

B.  Rec. . .  Bills  Receivable. 

Bile Black. 

BoH Bought. 

BroH. . .  .Brought. 

B.  W^...  Black  Walnut 


Cap Capital. 

C.  B Cash  Book. 

Co Company. 

Com . . .  .Commission. 
Const. . . .  Consignment 
Cr Creditor. 


Dec December. 

D'/t Draft. 

do The  same. 

doz Dozen. 

Dr. Debtor, 

tPs. Daja. 


ea Each. 

E.  E Errors  Excepted. 

EmVd..  .Embroidered. 

Ex Example. 

Exch. . .  .  Exchange. 
Exp Expenses. 


Fav Favor. 

Feb February. 

Fig'd..  ..Figured. 

Fol ...Folio. 

For'd Forward. 

FrH Freight 

G 

Qal Gallon. 


H 


Ehd. 


I 

/.  B Invoice  Book. 

Ins Insurance. 

Inst Instant 

Int Interest 

Inv Invoice. 

InvH . . .  .Inventory. 


Jan January. 

L 

V)s. Pounds. 

L.F....  .Ledger  Folio. 


M 
Mar March. 

Mdse. . .  .Merchandise. 

Mo Month. 

Mgy Mahogany. 

N 

Ko Number. 

Nov November. 

O 

Oct October. 

0.  I.  B.  .Outward  Invoice 
Book. 


P 

PayH. . . .  Payment 

P.  C.  B.  .Petty  Cash  Book 

Pd Paid. 

Pkg Package. 

Pr Pair. 

pr.,  per.  .By. 
Prem. . . .  Premium. 


Rec'd. . 
B.  W.. 


R 

, .  Received. 
.  Rosewood. 


S.B. Sales  Book. 

Sept.. . .  .September. 
ShipH. .  .Shipment 
Sunds. .  .Sundries. 


Yds. 
Yr.. 


Y 

.Tarda. 
.Yoai. 


OHA  RACTERS. 


®. 

.At 

£. 

.Pound  Sterling. 

X 

% 

.Account 

s. 

.Shilling. 

= 

%• 

.Per  Cent 

V- 

.Check  Mark. 

!• 

$. 

.  Dollars. 

+• 

.  Sign  of  Addition. 

!• 

^.. 

.Cents. 

.  Sign  of  Subtraction. 

7 

I^ 

X . .  Sign  of  Multiplication. 
.Sign  of  Equality. 
.One  and  one  fourth. 
.One  and  one  half 
.  One  and  three  fourtha 


PLAN    OF    THE    WORK. 


The  course  of  instruction  is  synthetical,  commencing  at  the  foun- 
dation and  working  upward,  making  each  principle  and  illustration 
the  opening  wedge  to  higher  developments  of  reason  and  applica- 
tion, and  enforcing  at  every  stage,  the  practical  bearings  of  the 
required  labor. 

The  Book  is  divided  into  two  parts.  Part  I  being  devoted  to 
Single  Entry,  and  Part  II  to  Double  Entry.  Each  part  comprises 
eight  distinct  Sets  of  Books,  four  of  which  are  written  out  in  full, 
and  four  given  in  the  form  of  memoranda  for  the  student  to 
arrange  after  the  models  given.  The  first  Set  in  Part  I  is  intended 
solely  to  show  the  use  of  the  i^rincipal  books.  Day  Book  and  Ledger. 
Set  II  begins  to  deal  in  results.  Set  III  commences  with  a  capital, 
representing  a  General  Merchandise  business,  shows  the  use  of  the 
necessary  auxiliary  books,  and  enforces  the  theory  of  loss  and  gain 
by  comparing  the  capital  at  commencing  with  that  at  closing.  Set 
IV  represents  a  Furniture  business,  introducing  the  necessary  prin- 
cipal and  auxiliary  books.  The  peculiar  feature  of  this  set  is  the 
admitting  of  a  new  partner,  and  contiiuiing  the  business  in  the  same 

books. Set.  I,  Part  II,  is  i:)urely  initiatory,  introduced  for  the 

purpose  of  enforcing  the  fundamental  principles  of  the  science.  Set 
II  continues  the  business  of  Set  I,  but  enlarges  it,  and  gives  a  wider 
scope  of  transactions,  and  more  fully  enforcing  the  theory  and  pro. 
cesses  of  producing  results.  This  set  is  given  in  colors,  as  affording 
a  more  exact  rriodel  for  imitation.  Set  III  contains  the  same  trans- 
actions as  Set  III,  Part  I,  and  is  presented  for  the  purpose  of  show- 
ing the  exact  differences  between  Single  and  Double  Entry.  Set  IV 
is  a  practical  set,  using  all  the  necessary  books  of  original  entry  as 
principal  books ;  posting  from  them  to  the  Ledger,  dispensing  Avith 
the  Journal  except  for  such  entries  as  are  not  recorded  in  the  other 
books.  This  set  exhibits,  in  the  most  decided  manner,  the  economy 
and  symmetry  of  Double  Entry. 

The  intermediate  "  Exercises  for  the  Learner,"  and  "  Examples 
for  Practice,"  are  relied  upon  to  make  the  theory  and  jiractice 
of  the  different  sets  effective.  The  "  Practical  Hints,"  at  the  close, 
embrace  suggestions  Avhich  should  not  be  overlooked. 


PART   I. 


SINGLE    ENTRY. 


PART    I. 
SINOLE     ENTRY 


INTRODUCTION. 

*  In  estimating  the  true  basis  of  any  science,  it  is  well,  if  possi- 
ble, to  follow  the  line  of  its  history,  and  become  familiar  with  the 
order  and  processes  of  its  development.  ^  This  is  especially  true 
of  the  science  of  Book-keeping,  for  although  it  is  purely  a  branch 
of  mathematics,  and  as"  such  fully  entitled  to  the  favor  and  considera- 
tion of  scientific  men,  yet  at  no  period  of  its  history  bus  it  ranked 
in  the  estimation  of  scholars,  with  the  more  complex  and  abstract 
sciences ;  '  which  fact  is  owing,  mainly,  to  a  misconception  or 
under  appreciation  of  its  dignity  and  importance  as  connected  with 
the  actual  duties  of  life.  It  is  lamentably  true  that  men  will  grow 
enthusiastic  over  the  solution  of  a  problem  in  Euclid,  or  the  effect 
of  a  combination  of  movements  upon  a  chess-board,  who  are  ignor- 
ant of  the  first  principles  of  this  the  most  beautiful  and  practical  of 
sciences ;  and  are  content  to  pass  through  life,  receiving  and  appro- 
priating the  reputation  belonging  to  men  of  science  and  erudition, 
while  they  are  consciously  and  persistently  xmable  to  decide  the 
simplest  question  in  partnership  settlements,  or  to  appreciate  the 
well-established  theory  of  debits  and  credits  in  any  of  its  practical 
applications  or  philosophical  abstractions. 

It  is  difficult  to  account  for  this  strange  inconsistency  except  upon 
the  ground  that  Book-keeping  is  a  practical  science,  and  as  such  is 
suggestive  of  rude  contact  with  actual  business  Ufe.  It  has  too 
much  of  "  the  smell  of  the  shop,"  and  mixes  too  promiscuously  with 
unpoetic  bales,  boxes,  and  barrels.  It  is,  doubtless,  this  restricted 
view  of  the  science  Avhich,  more  than  aught  else,  has  deprived  the 
world  of  sufficient  data  from  which  to  compile  its  history,  and  left 

11 


INTRODUCTION. 

to  the  imagination  and  logical  inference  what  had  else  been  a  con- 
nected series  of  recorded  facts. 

Necessity,  it  is  said,  is  the  mother  of  invention ;  and  as  all  science 
is  the  immediate  result  no  less  of  invention  than  investigation,  it 
may  with  truth  be  said  that  science  is  the  offspring  of  necessity. 
That  the  science  of  Book-keeping  is  essentially  so  will  be  apparent 
in  tlie  commonest  application  of  its  principles. 

^The  very  condition  of  life  is  want^  and  the  plans  and  purposes 
of  life  aim  at  the  supplying  of  want.  *  This  necessity  of  our  being 
begets  industry  and  frugality,  and  lays  the  foundation  of  all  real 
progress  in  arts  and  civilization. 

^  To  supply  the  necessities  of  life  the  earth,  through  careful  and 
patient  toil,  is  made  to  yield  her  abundance,  and  the  various  chan- 
nels of  human  enterprise  and  skill  are  laid  under  perjjetual  contri' 
bution. 

'  The  wants  of  man  are  so  numerous,  and  the  means  of  supplying 
them  so  vax'ious,  that  a  system  of  mutual  dependence  and  reciprocal 
labor  becomes  not  only  economical,  but  necessaiy ;  and  thus,  from 
the  very  first  enforcement  of  the  divine  law^  "In  the  sweat  of  thy 
face  shalt  thou  eat  bread,"  has  there  grown  up  a  division  and  classi- 
fication of  labor  and  wealth. 

^The  tiller  of  the  soil,  M'hose  products  supply  the  necessities  of 
hunger ;  the  manufacturer  of  fabrics,  Avhich  are  to  clothe  the  body ; 
the  artificer,  whose  cunning  Avorkmanship  gratifies  the  more  refined 
wants  and  tastes ;  the  man  of  science,  who  supplies  food  for  the 
mind ;  the  spiritual  teacher,  who  ministers  to  the  higher  develop- 
ment of  soul  faculties,  and  the  common  laborer,  who  lifts  frOm  onr 
shoulders  the  drudgery  of  baser  toil,  are  each  dependent  upon  all 
the  others  for  the  sum  of  material  and  intellectual  comforts  Avhich 
minister  to  their  individual  wants  ;  ®and  a  mutual  exchange  of  these 
comforts  constitutes  the  foundation  principle  and  impulse  of  that 
grand  system  of  economy  which  we  call  Busixess. 

'"To  facilitate  these  exchanges  it  has  been  found  necessary  to 
establish  some  regular  standard  of  value  by  which  the  comparative 
worth  of  commodities  may  be  adjusted.  "  This  standard  is  usually 
represented  by  certain  precious  metals,  usually  gold  and  silver, 
which  also  serve  as  a  medium  in  effecting  the  exchanges.  In  all 
civilized  countries  this  metal  is  divided  into  convenient  particles, 
and  stamped  with  its  ajipraised  value,  and  is  used,  either  really,  or 
by  implication,  in  all  commercial  dealings. 

*^  The  particular  necessity  of  Book-keeping  is  to  preserve  a  record 

12 


INTRODUCTION. 

of  such  exchanges  as  would  otherwise  be  trusted  to  memory ; 
although  a  thorough  application  of  the  science  embraces  other  most 
important  results.  Its  more  simple  and  restricted  use  may  be  easily 
shown. 

Suppose,  for  example,  that  John  Smith  is  a  fanner,  and  Thomas 
Jones  a  manufacturer ;  that  John  raises  as  much  food  on  his  farm 
as  is  necessary  to  supply  his  own  wants  and  those  of  his  neighbor, 
while  Thomas  makes  clothing  sufficient  for  the  demands  of  both. 
It  is  now  the  easiest  thing  in  the  world  for  both  John  and  Thomas 
to  have  food  and  clothing,  simply  by  exchanging  with  each  other 
their  surplus  products.  '*  An  exchange  of  this  kind  would  possibly 
need  no  record ;  and  were  this  the  extent  to  which  commerce  had 
been  carried,  it  is  scarcely  probable  that  obstinate  brains  would 
have  been  puzzled  with  the  dry  formulas  of  Book-keeping.  But, 
suppose,  further,  that  Thomas  should  happen  to  be  in  immediate 
want  of  some  of  his  neighbor's  surplus  food,  without  the  ability, 
at  the  time,  to  render  an  equivalent  in  his  own  pi'oducts.  He  says 
to  John,  "I  want  food,  and  cannot  pay  tor  it  now,  but  if  you  will 
confide  in  my  honor,  I  will  surely  return  you  an  equivalent  when 
I  have  completed  work  now  in  progress."  The  conditions  being 
satisfactory,  the  food  is  conveyed  fi-om  John  to  Thomas,  and  the 
proinise  from  Thomas  to  John.  If  John  is  blessed  with  a  faithful 
memory  he  may  be  able  to  retain  the  facts  connected  Avith  this 
transaction,  and  thus  constantly  bear  in  mind  that  he  oicns  a  cer- 
tain quantity  of  clothing,  which  his  neighbor  is  to  bring  him  at  a 
stated  time.  "  But  suppose  he  is  not  willing  to  trust  to  his  own 
memory,  nor  to  that  of  his  neighbor,  but  desires  something  tangible 
which  shall  at  least  represent  this  prospective  property — a  record 
Avhich  will  not  fade  with  the  memory,  but  AVill  stand  for  the  benefit 
of  whom  it  may  conceni,  even  in  the  absence  of  those  having  a  per- 
sonal knowledge  of  the  facts.  The  person  relied  upon  to  fulfill  this 
promise  is  Thomas  Jones,  and  ^'  the  most  natural  form  of  record 
would  be  to  write  his  nams  in  a  book  kept  for  that  purpose,  and 
state  the  fact  underneath  it,  thus : 

THOMAS    JONES 

Bought  of  John  Smith,  a  quantity  of  food,  valued  at  Ten  Dollars,  for  which  he 
agrees  to  pay  a  quantity  of  clothing  of  equal  value,  on  [naming  the  date  of  pay- 
ment.] 

"  A  record  like  the  above  would  be  intelligible  as  containing  all 
the  facts,  and  affording  to  John  Smith  a  tangible  evidence  of  prop- 

13 


INTRODUCTION. 

erty  which  he  owns,  but  which  is  in  the  hands  of  another  party; 
and  if  this  single  transaction  comprised  all  of  this  nature  it  wouJd 
scarcely  be  worth  while  to  attempt  a  more  concise  or  symmetrical 
record.  "  But  as  dealings  of  this  kind  may  be  very  frequent,  not 
only  with  Thomas  Jones,  but  with  other  parties,  it  may  be  well  to 
ascertain  if  some  more  satisfactory  and  less  cumbrous  method  may 
not  be  adopted. 

''The  simple  fact  expressed  in  the  foregoing  record  is  that 
Thomas  Jones  owes  John  Smith  ten  dollars  worth  of  clothing. 
"  The  only  events  which  can  vaiy  this  fact  are,  the  payment  of  the 
debt,  or  a  part  of  it,  overpaying  it,  or  adding  to  it  by  subsequent 
purchase  without  payment.  '"There  are,  really,  but  two  condi- 
tions, as  pertaining  to  persons  with  whom  we  have  dealings  on 
credit,  viz. :  that  of  oici7ig,  and  being  oiced.  *'  These  two  condi- 
tions are  exact  counterparts,  and  so  far  as  they  are  equal,  will  can- 
cel each  other. 

*'  It  will,  therefore,  be  easy  to  arrange  these  opposite  facts  under 
the  names  to  which  they  pertain  in  such  way  as  that  not  only  the 
facts  themselves,  but  their  relative  results,  may  be  ascertained  at 
a  glance.     For  example : 


Dr. 


Thomas  Jones. 


Do7».      C(».        Date. 


Cr. 

DoUt.      CU. 


1861 
Jan. 


Mar. 


To  IBbl.  Flour 

"  10  Bnah.  Wheat. 


60 


Jan. 
Apr. 


By  4  yds.  Cloth. 
"  Cash 


This  form  has  been  found  by  experience  to  be  both  compreben- 
sive  and  practical.  ''It  is  called  an  account^  and,  as  will  be 
readily  seen,  "is  a  statement  of  dealings  with  Thomas  Jones. 
**  On  one  side  are  arranged  the  separate  amounts  of  his  indebted- 
ness to  us,  and  on  the  other  of  our  indebtedness  to  him.  **The 
difference  or  result  will  be  a  net  amount  owing  either  to  us  from 
Thomas  Jones,  or  to  Thomas  Jones  from  us.  In  other  words,  if 
Thomas  Jones  owes  us  more  than  we  owe  him,  the  indebtedness  is 
in  our  favor,  and  may  be  reckoned  as  a  part  of  our  property  ;  while, 
if  we  owe  him  more  than  he  owes  us,  the  indebtedness  is  in  his 
favor,  and  should  be  reckoned  among  our  debts.     The  facts  shown 

14 


INTRODUCTION. 

in  the  account  given  may  be  thus  analyzed :  "  On  the  first  of  J.anu. 
ary  Thomas  Jones  purchased  of  us  1  barrel  of  flour  at  $10;  and  on 
the  loth  of  January,  sold  us  4  yards  of  cloth  for  enoTigh  to  cancel 
the  debt.  The  amounts  on  the  opposite  sides  of  the  acoount  will 
now  exactly  balance  each  other,  and  the  result  is  the  same  as 
though  the  exchange  had  been  made  at  once.  Again,  on  the  first 
of  March  he  purchased  10  bushels  of  wheat,  for  $13  50  ;  and  on  the 
first  of  April  pays  us  in  cash  $5.  This  leaves  a  deficiency  in  his 
account  of  the  difference  between  $12  50  and  $5 ;  and  we  say  that 
Thomas  Jones  owes  us  $7  50.  We  have  thus  a  tangible  record  of 
property,  which  if  left  to  memory  might  be  forgotien,  and  we  thus 
become  losers. 

"It  will  thus  be  seen  that  in  all  cases  where  exchanges  are 
effected  between  parties,  either  of  whom  is  allowed  time  to  perform 
his  part  of  the  contract,  some  written  record  of  the  facts  are  neces- 
sary. *'This  written  record  constitutes  the  germ  and  sphere  of 
Book-keeping. 

From  the  foregoing  illustration  it  will  appear  that  ^  an  account 
has  two  sides,  a  ''  debtor  and  a  creditor  /  that  '*  upon  the  debtor 
side  is  shown  what  is  owing  to  us,  and  ^upon  the  creditor  side, 
what  is  owing  5y  us ;  "  that  when  the  debtor  side  is  the  larger, 
the  difference  will  express  an  amount  belonging  to  us,  ''  and  when 
the  creditor  side  is  the  larger,  the  difference  will  express  an  amount 
which  we  owe.  ^*  In  the  former  case  the  account  would  represent 
property  or  resources ;  "  and  in  the  latter,  debt  or  liability. 

^  In  the  earlier  history  of  Book-keeping,  doubtless  this  form,  or 
something  similar,  was  deemed  sufficient  for  the  purposes  of  trade, 
'*  it  being  absolutely  necessary  only  to  have  some  written  evidence 
of  such  resources  and  liabilities  as  had  no  other  tangible  existence, 
and  which  it  would  be  unsafe  to  trust  entirely  to  memory.  *°  It  is 
evident,  however,  that  in  an  extensive  credit  business,  a  book  of 
consecutive  record,  giving  a  plain  and  simple  account  of  the  business 
as  it  progresses  day  by  day,  would  be  of  essential  service,  and  it  is, 
therefore,  the  almost  universal  practice,  particularly  among  mer- 
chants and  tradesmen,  to  keep  a  *'  Day  Book,  in  which  are  entered 
transactions  as  the^  occur. 

An  example,  showing  the  form  «f  this  book,  and  also  that  of  the 
Ledger,  with  the  transactions  properly  transferred,  will  be  seen  on 
the  following  page. 


15 


INTRODUCTION. 


DAY    BOOK. 


New  York,  January  30,  1861. 


Jan. 


Mar. 


Jou2f  Smith,  Dr. 

To  5  yds.  Broadcloth @  $4  00  $20 

"10   do    Cassiiiiere @    150  15 

«  30  do    Black  Dress  Silk.®    1  25  87  50 

"  25  do    Flannel @        50  12  60 

"  10  do    Figured  Silk @    1  50  15 


John  Smith, 


By  Cash  paid  on  account, 


Cr. 


100 


75 


These   entries,  carried   to  the  Ledger,  which  is  the  Book  of 
Accounts,  would  appear  thus : 


Dr. 


LEDGER 
John  Smith. 


Cr. 


Jan.     30     To  Merchandise.. 


100 


Mar.       1      By  Cash 


r5 


^'The  advantages  of  a  Day  Book  are  twofold:  First,  it  affords 
a  regular  daily  history  of  the  business ;  and,  next,  by  giving  the 
particulars  and  details  of  each  transaction  in  the  Day  Book,  the 
amount  alone  may  be  carried  to  the  Ledger,  requiring  thus  less 
space,  and  preserving  a  more  symmetrical  form  of  the  Ledger 
accounts. 

''*  The  Day  Book  and  Ledger  in  Single  Entry  contain  only  such 
transactions  as  relate  to  persons.  '"AH  prudent  men,  however, 
Avill  feel  the  importance  of  having  a  strict  record  kept  of  the  receipts 
and  payments  of  cash  and  other  people's  notes,  and  of  the  issue  and 
redemption  of  their  own  notes.  '"'  This  is  done  by  means  of  books 
specially  arranged  for  such  purpose. 

The  following  are  the  most  simple  of  these  forms : 


16 


INTRODUCTION. 


CASH    BOOK. 


Jan 

1 

$3000 
150 

T5 

18 

110 

75 

175 
600 

400 

2278 

Received  of  James  Monroe,  on  account 

Paid  Store  E.xpenses,  as  per  Kxpense  Book 

"         "  Rol^ert  M  Hart    "     "             "     

Paid  A.  T.  Stewart  in  fuli  of  account 

Balance  on  liand 

75 

»i!)S    ir, 

3853 

75 

2 

Amount  brought  down 

2278  j  7S  |j 

BILL    BOOK. 


Bills    Receivable. 


No. 

When 
Rec'd. 

Drawer  or 

Endorser. 

Drawee  or 
Maker. 

Date. 

Time. 

When 
Due. 

Amount. 

When  aod  How 
disposed  of. 

1 

2 
3 

4 

1861 
Jan.  1 

"    5 

Feb.  1 

"  15 

Robert  Mintiim, 

Charles  Hawley, 
A  brain  Duryea, 
W.  W.  Granger, 

Ja<.  Cruikshank, 

David  Woods, 
Duncan  Phyfe, 
Ivison  <t  Phluney, 

186) 
Dec.  1 

ISil 
Jan.  5 

■'  10 
Feb.  15 

6Jd8. 

?l\  ds. 
POds. 
60  ds. 

1861 
Feb.  2 

Feb.  7 
A  p.  13 
Ap.17 

fiOO 

1000 
15UU 
300 

1861 
Feb.  2 

Feb.  7 

Paid. 
Paid. 

Bills   Payable. 


ifo. 

When 
Issued. 

Drawer  or 
Endorser. 

Drawee  or 
Maker. 

Date, 

Time. 

When 
Due. 

Amount. 

i  Whrn  and  How 
Redeemed, 

1 

2 
3 

1861 
Jan.  12 
Har.  1 

Samnel  Higgrins, 
Peter  Cook, 
John  D.  HInde, 

Ourselves, 
do 
do 

Jan.  12 
Mar.   1 

15  ds. 
9'»d9. 
60  ds. 

Jan.  JO 
June  2 
Apr.  5 

150 

7flO 
300 

1861 
Jan.  .^O 

Paid. 

These  simple  and  suggestive  forms  comprise  the  books  commonly 
used  in  Single  Entry  ;  and  are,  perhaps,  sufficient  for  the  most  press- 
ing demands  of  business  record.  It  will  be  the  aim  of  the  instruc- 
tions which  follow  in  this  part  of  the  work,  to  present  the  subject 
of  Book-keeping  as  expressed  through  the  forms  of  Single  Entry  in 
as  progressive  a  manner  as  possible;  and  with  a  view  to  prepare 
the  mind  of  the  student  for  the  more  perfect  and  beautiful  science 
of  Double  Entry,  which  is  unfolded  in  Part  Second. 

17 


INTRODUCTION. 


QUESTIONS    FOR   REVIEW. 


1.  How  can  the  trae  basis  of  any  science  be  best  estimated  ?  2.  Why  is  this 
especially  true  of  Book-keeping  ?  3.  "Why  has  Book-keeping  not  usually  been  ranked 
with  abstract  sciences  ?  4.  What  is  the  chief  condition  of  life  ?  5.  What  does  this 
necessity  beget?  6.  How  are  the  necessities  of  life  suppUed?  1.  What  system 
grows  out  of  the  numerous  wants  of  man  ?  8.  Name  some  of  the  classes  of  men 
who  are  mutually  dependent  one  upon  the  other  ?  9.  What  constitutes  the  founda- 
tion principle  and  impulse  of  business?  10.  How  are  these  exchanges  facilitated? 
11.  How  is  the  standard  of  value  represented?  12,  What  is  the  particular  neces- 
sity of  Book-keeping  ?  13.  In  the  case  cited  between  John  Smith  and  Thomas 
Jones,  where  the  food  and  clothing  are  simultaneously  exchanged,  is  there  any 
actual  need  of  a  written  record  ?  14.  In  the  case  where  the  payment  of  the  cloth- 
ing is  deferred,  why  is  a  written  record  necessary?  15,  What  is  the  most  natural 
record  of  the  indebtedness  of  Thomas  Jones  in  the  example  given?  16.  Would 
this  record  be  intelligible?  17.  Why  is  a  more  symmetrical  and  concise  record 
necessary?  18.  What  is  the  simple  fact  expressed  in  the  foregoing  record? 
19.  How  may  this  fact  be  varied?  20.  How  many  conditions  are  there  pertaining 
to  dealings  with  persons  on  credit?  21.  How  are  these  conditions  as  compared 
with  each  other?  22.  How  may  these  opposite  facts  be  best  arranged?  23.  What 
is  this  form  called  ?  24.  How  may  it  be  defined  ?  25.  What  facts  are  arranged  on 
either  side  of  an  account  ?  26.  What  is  shown  by  the  difference  between  the  sides 
of  an  account?  27.  Will  you  analyze  the  entries  in  Thomas  Jones'  account? 
28.  In  cases  where  exchanges  arc  effected  involving  time  in  their  fulfilment,  what  is 
necessary?  29.  What  does  this  written  record  constitute?  30.  How  many  sides 
has  an  account?  31.  What  are  they  called?  32.  What  is  shown  by  the  debtor 
side  ?  33.  What  by  the  creditor  side  ?  34.  If  the  debtor  side  be  the  larger,  what 
•'ill  the  difference  express?  35.  What,  if  the  creditor  side  be  the  larger?  36.  What 
»rill  the  account  represent  in  the  former  case?  37.  What,  in  the  latter?  38.  In 
the  earlier  history  of  Book-keeping  what  form  of  record  was  probably  used? 
39.  Why  was  this  form  alone  sufficient?  40.  What  other  forms  become  necessary  in 
an  extensive  credit  business?  41.  What  book  is  usually  kept  by  merchants  and 
tradesmen  ?  42.  What  are  the  advantages  of  a  Day  Book  ?  43.  What  class  of 
transactions  do  the  Day  Book  and  Ledger  in  Single  Entry  contain  ?  44,  What 
other  records  will  all  prudent  men  keep  ?    45.  How  is  this  done  ? 


18 


SET    I. 

— — -— »»  ♦  »»  ■ 

(INITIATORY.) 

DA.Y"   BOOK    A.ND    LEDOER. 


SHOWma  SIMPLT  THE  USB  OF  THE  BOOKS,  WITHOUT  EIHIBITnTO 
X  OENEBAL  BESULT. 


REMARKS. 


In  the  following  set  we  have  the  simplest  forms  known  in  300*?^- 
keeping,  viz :  '  the  Day  Book  and  Ledger.  *  This  set  is  designed 
to  be  purely  initiatory,  and  is  introduced  mainly  to  exhibit  the 
forms  and  character  of  these  important  books,  which  will  be  exten- 
sively used  hereafter. 

It  must  be  borne  in  mind  that '  the  true  purpose  of  Book-keeping 
is  to  preserve  a  sufficient  record  of  resources  and  liabilities,  to 
enable  the  proprietor  at  any  time  to  ascertain  the  condition  of  his 
business.  *  This  purpose  is  only  partially  effected  in  the  records 
which  follow,  but  it  is  deemed  important  that  this  class  of  property 
and  debts  should  be  clearly  understood  before  proceeding  to  the 
others. 

*  A  Ledger,  in  Single  Entry,  is  used  to  exhibit  the  relation  in 
which  the  various  persons  with  whom  we  deal  on  account  stand  to 
our  business,  and  contains,  therefore,  only  perso7ial  accounts^  or 
accounts  with  persons.  Inasmuch,  therefore,  as  every  entry  on  the 
Day  Book  is  posted  to  the  Ledger,  '  the  Day  Book,  also,  contains 
only  records  which  pertain  to  persons. 

'  The  Day  Book  records  in  Single  Entry  are  direct  and  simple, 
first  expressing  the  name  of  the  person  to  be  debited  or  credited  on 
the  Ledger,  together  with  the  fact  of  "Dr."  or  "  Cr.,"  and  next  the 
consideration  and  amount.  *  These  records  are  then  transferred 
under  the  appropriate  Ledger  accounts,  and  thus  exhibit  *the 
result  of  the  transactions,  so  far  as  persons  are  concerned. 

The  set  here  shown  exhibits  but  few  transactions,  and  those  of 
the  most  simple  kind,  '"  and  is  not  intended  to  show  any  general 
result  of  the  business  \  the  main  object  being  to  set  forth  the  nature 
and  process  of  the  records  which  are  to  appear  upon  the  Ledger. 

The  student  is  requested  to  note  Avell  the  form  and  expression, 
that  he  may  correctly  render  the  "  Exercises "  which  follow  this 
set,  and  become  prepared  for  the  progressive  labor  in  the  succeed- 
iuff  sets. 


20 


DAY  BOOK -SET  I. 

G^  §Ud,  ^^  /;  /M. 


i^oiace/    '-jffe^/ei, 


OT^ 

/J"^    2  2S 
/  00      4  00 


rK    r^.     ^a'lAen/ed., 


<:%   J^O  ■^.    ^iSa^n, 


//*         S  ^0 
2  00 


^u   Tacun  on   A 


J 


^< 


^., 


^^     S  3§u^.    M^a^e^,  „  /  00        S  00 


21 


jf 


i-^j? 


/ 


/ 


^ 


^(^ 


^ 


/^ 


2 


DAY  BOOK -SET  L 

oJ^em  ^cd,  ^(A  dT,  M^. 


^> 


S. 


^ye/e^y'    ^ooAe-L, 


f,     SO  <w,    e^aal, 

/2  " 


//    '*    // 


&/S^ 


^  SO 
d'OO 
/S2 


^ 


<8Ue/i4cn  (y.    aWa^tcAcUc/, 


^a    /  Mif/ ^(CejS  Mlit, 


'<,  ®  /f^ 


//  00 
PO  00 


Q^  ^.   MA^ooc/, 


?^. 


^. 


Q'a'meJ  (z/i^eeney. 


,^       SO  ,,      'iolud^et/  ,,       ,,  cf  * 

„  S  ^/<^.    .^^(^e^,     „    020 


P  00 

^  00 

6'0  00 


// 


S'2 


/O/ 


JOO 

/o/ 


/o/ 


TS 


S4 


LEDGER -SET  I. 


f.^ 


<%^m^.^i^. 


/ 


S 


20 


^-'f^  &ima     mum^^an^,  ^^f 


/^^o 

Q^*^ 


■^  /■Owv  ^atinind 


s 


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So  i^tnc/.  J^l^. 


/ 


SO 


u^o 


<Xu   tSooA, 


23 


^<f 


LEDGER -SET  I. 


f^ 


c%  /■*<$^c%«^ , 


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s 


c%  d/u^.  iJ^i^. 


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s 


<%^Cna(,M/. 


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S'2 


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^ 


S'oMc^.^l^. 


/o/ 


/S'^O 


/ 


^ou/.{<J:^?i 


/o/ 


24 


LEDGER -SET  I. 


>^ 


/ 


on  i/wauto. 


^* 


/o/ 


/ 


,S6y^tuo/lyfCc^e 


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0/^  Jf^am^  ryi{Aee?z^y,  ^yf 


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C%  7  C%rf<»  t7««S 


^^ 


25 


EXERCISES   FOR   THE   LEARNER. 


miRSTSERIES.  • 

The  following  transactions  are  to  be  written  up  in  proper  form 
njion  the  Day  Book,  and  from  thence  posted  to  the  Ledger,  as  in 
the  set  preceding. 

Memoranda.        • 

Jan.  1.  Sold  H.  W.  Ellsworth  on  7c,  5  Bbls.  Flour,  ®  $10.  Sold 
James  Harper  6  lbs.  Coffee,  @  U^ ;  5  lbs.  Black  Tea,  @  75^ ;  de- 
ceived Cash  on  %,  $2 2.  Bought  of  Geo.  A.  Crocker  on  %, 

60  Bush.  Apples,  @  50f ;  50  Bbls.  Potatoes,  @  $2  50 3.  Sold 

Geo.  H.  Brown  on  %,  10  Bbls.  Apples,  ©75"^;  3  lbs.  Black  Tea, 

@  75^ 4.  Paid  Geo.  A.  Crocker,  Cash  on  %,  flOO 

5.    Sold  Abraham  Lincoln  on  /^,  2  Yds.  Broadcloth,  @  $3  ;  50  lbs. 

Sugar,  @  S'f ;  30  Yds.  Sheeting,  @  lO'f 7.  Bought  of  James 

Madison,  on  %,  10  Bbls.  Potatoes,  @  62  50 a    Sold  F.  A. 

Perley,  on  %,  5  Bbls.  Potatoes,  @  $3  ;  10  Bush.  Apples,  @  68^.  .  .  . 

10.   Paid   Geo.  A.  Crocker,  Cash,  $50 11.   Sold  P.  C. 

Schuyler,  10  Yds.  Broadcloth,  @  $5  ;  Received  in  cash,  $25 

l^^old  Peter  Cooper  on  %,  8  lbs.  Coffee,  @  12'f;   3  lbs.  best 
B^^  Tea,  ®  $1 ;  50  lbs.  Crushed  Sugar,  @  12f. 


QUESTIONS    FOR    REVIEW. 


1.  "What  fonns  are  shown  in  Set  I.  ?  2.  For  what  is  this  set  designed  ?  3.  What 
IS  the  true  purpose  of  Book-keeping?  4.  Is  this  purpose  fully  carried  out  in  tho 
exercises  of  Set  I.  ?  5.  What  is  shown  iu  the  Single  Entry  Ledger?  6.  What  does 
the  Day  Book  contain?  7.  What  is  the  form  of  record  in  the  Sing.e  Entry  Day 
Book  ?  8.  Where  are  these  records  transferred  ?  9.  When  so  transferred,  what  do 
they  exhibit?     10.  la  there  any  general  result  shown  in  this  set? 


26 


SET    II. 

►«  ♦  «■• 

KETAIL  DRY  GOODS  BUSINIiSS. 

DAY  BOOK,  LEDGER  AND  CASH  BOOK. 

WITH  STATEMENT  OF  RESULTS  AT  THE  CLOSE. 


'S\Jisv^c-&%  '^vos\k.evovt*. 


REMARKS. 


In  this  set  we  are  enabled  to  arrive  at  more  perfect  and  satisfac- 
tory results,  and  to  carry  out  more  fully  the  true  purpose  of  Book- 
keeping, *  that  of  exhibiting,  at  any  time,  the  condition  of  the 
business. 

By  the  use  of  the  Cash  Book  we  compass  a  most  important 
object,  in  '  keeping  a  check  on  the  receipts  and  disbursements  of 
cash,  and  showing  the  amounj  on  hand.  ^  Of  all  the  books  used  in 
business  none  is  more  essential  than  this ;  and  no  cautious  business 
man  will  ever  attempt  to  do  without  it.  It  is  true,  the  amount  of 
cash  on  hand  may  be  easily  ascertained  at  any  time  "*  by  counting  it ; 
but  'thig  process  affords  no  test  as  to  improper  expenditures  or 
omissions.  *  A  faithful  record  of  the  receipts  and  disbursements  of 
cash,  however — the  difference  agreeing  with  the  amount  actually  on 
hand — gives  a  degree  of  confidence,  not  only  in  reference  to  the  cash 
transactions,  but  to  the  business  generally,  which  can  be  secured'iu 
no  other  manner. 

'A  Cash  Book,  properly  kept,  will,  at  any  time,  show  the  amount 
of  cash  on  hand ;  and  for  this  special  purpose  is  it  introduced  in  this 
connection.  The  form  here  used,  though  pei-haps  not  the  best  for 
general  purposes,  is  extremely  simple  and  easily  understood.  It  is 
customaiy,  in  most  business  houses,  to  close  up  the  Cash  Book  *  at 
the  end  of  each  business  day,  and  bring  the  balance  down  as  a  basis 
for  the  next  day's  transactions.  '  We  have  varied  this  plan  to  bet, 
ter  suit  our  convenience,  closing  up  each  week  during  the  first 
month's  business,  and  only  once  in  the  next  month.  This  is  deemed 
sufBcient  for  the  purposes  of  illustration. 

The  particular  advance  which  is  made  in  this  set  over  the  preced- 
ing is  more  apparent  in  the  statement  which  follows  the  Cash  Book, 
and  which  will  show,  at  a  glance,  the  grand  design  of  Book-keeping. 

Nothing  is  more  desirable  in  connection  with  business  record  than 
^^  the  ability  to  exhibit  results  in  a  clear  and  unmistakable  manner. 
To  this  end  the  learner  should  be  taught  to  attach  much  importance 
to  the  statements  given  in  connection  Avith  the  various  sets,  and 
particularly  to  the  principles  deduced  therefrom. 

28 


DAY  BOOK- SET  11. 


o6u  >yftMe,  /lei   Qrnvo*ix, 

^^k'Y^ 

r.. 

-^000 

/p 

-fO 
(fO 

s/ 

4S 

/o 

^0   /O  ^.    ^a^, 

,,    SO      ,,       oMce/tna, 
„      jf     „      ^U.ac/c4//, 

„    so^ 

„     /o'^ 

•    „  JOO 

/so 

/  00 

S  00 

/S  00 

2(f 

c^   /S  ^.    ^a^t^nele, 

„  SO  „  Bie/  i/'y/, 

&  /  00 
„  /SS 

/S  00 
SS  00 

c%  /O  ^.    'i^e^y, 

<&  S  00 

so  00 
/O  00 

,,/S     „      <J^.aca, 

©    so* 
,,/so 

S  00 
/.f  00 

c%  /s  <^.  ^i./ ify/f,        %  /so 

/S'OO 
S4  00 

\ 

^u   ^adn  on    />> , 

r.. 

29 


2 


DAY  BOOK -SET  II 


'^uUt<f   JmeetfocA, 


l::>-u4M^ 


^00 

/  <ro 


/o 


\yit^e4.^  ..^ efn.a4.e<^/, 


/2   


SO  00 

^  so 


Q^TfteJ  ^^/^cJ'^t/e^,     /yiei.  i^*^,J  ^4.. 


,,     /O  ^,    ^o^/on    ^'<i7nad/,        ®         2S^ 
_,,     //     y,       IM^cen  ^ofimax^e,    ^^   /  SO 

/s 


^00 

s  so 

2/00 


Q/ameJ  ^an^^eCt,       /y'lei.  aaMyA/e4,,y  ^^'i 


,,     J  ^oj..    i/k/tn   ^uZ/on^,             '„         2S^ 
^ //    


/  00 

/so 

S2 


^o    /  fc/.    ^/ac/ ifu/,n, 


S  00 

/so 


SS 


ss 


^/  so 


/s 


sp 


so 


<r/ 


s  so 


DAY  BOOK -SET  11. 


^j 


^  ^  Mc/cuc/, 


^. 


^0  00 
P  00 
J  00 


^  ^  Mc/cuc/, 


B^. 


<%    /O  fc6.   S^lenc^ 3SLoadi4^^,  <^  ^  00  ^0  00 

,,  ;fO    „     ^^^  ^i^,  „  /S^  ^  so 

,,    so     ,,      ^a/ieiy  'i^a^n^l<hJ,  ,,  /S^  S  -^0 

„     /S    „      "^o^^on  ^a^a^,  ,,  2S^  J  ^S 

„    SO      ,,       "t^o/^ona^e^,  „  JJ^  fi  pO 

„      /f^athf  '/Sii/ ydf^,  „  ^S^  ^  SO 


%jOy    ©«rf/^ 


3 


^/ 


SO 


0 


SO 


^/ 


so 


03 


31 


4 


DAY  BOOK -SET  II. 


.  s/ 


MmoJ  ^, 


ean. 


SO 


^y    UHadA  on    ^f 


3S^   '(Sa^in^/o/%, 


Q^jaac  Q/¥even<f, 


/O^         '^0 

2  00 

^*  40 


%  2  00  /2  00 
„  JO^  ^00 
J,      2J^      /  SO 


/  2S 


^/^  SO. 

/  oo\ 


/o 


so 


/p 


so 


40 


/<S' 


'6-2, 


m^ 


DAY  BOOK -SET  11. 


5 


J  CO 
S2  so 


2 


(l/i.   t^sC  (^i,nneu, 


^^   SO      ,/        ^nec4^  'j6*nana'm,       ,,         20 


/^JO 
J  00 
^  00 


s 


^4. 


<f 


d^  ^  Mc/cuc/, 


^o  /S  f^.   ^ucif  ^i^y,      ®       20^ 

//     ^0     ,,      <^lottin  J,  ,,  SO' 

„       <f^a,U  ^cai/S^.un  ^oJe,   „         ^S^ 

/    


J  00 
S  00 

^  so 


,:^at^ta  f^  Q/oArufon, 

J,    /O     ,/        ^oeJ^n, 


i^  ^  00 
,,2  00 


S2  00 

20  00 

2  00 

SOO 


SS 


SO 


JO 


2000 


/o 


sa 


^p 


<%  /^  fc/j.   ^i^jS  4fy/,  ^2  00 


B^. 


33 


6 


DAY  BOOK -SET  11. 


cy 


"7 


t.yi<^e-i^  ^.    &yien€e^. 


^., 


/o 


S  00 
S  ^0 


/2 


(.yc.   t^.  Q:^-mneu, 


<%    (f^acij  ^en^.    ^o^e,                &         SS^ 
/S    


/SO 
/  00 


Ofa; 


c%  /O  f^.  MuWcd//,  %  ^  00 

,,      ^    „       ^oed/*k,  „  2  00 


^0  00 
/2  00 


'^■t. 


20 


<^o   ^  f-A    ^eat^eiy  ^^/<  %  J  00 

,,      7       y,        ii/aTfn, 

yy     ^Lt?n/miita<f  jfoi/  ^oa€^  ane^     C/edf^ 

2/  


/2  00 
■}  00 
S^OO 


P 


SO 


^<f 


2S 


SS 


ss 


s^ 


// 


sj- 


34 


DAY  BOOK -SET  II. 


s. 


H. 


^/ 


ifj 


J  00      /O  00 

/^^    <r  00 


/  SO*^    2/00 
/O  00 


s<? 


SO  


^  00      ^cf  00 
2  00      /2  00 


/cT 


S^ 


SJ 


<f0 


,,      yO     ,,      tyiejjea  is/'tantief. 


/i'*      ^00 

/s^    ^  so 


"^y   iSa<//»  <'n.  <u^^eo/^  r^ , 


/s 


SJ 


so 


35 


INDEX  TO  LEDGER,- SET  11. 


A 

.___  S 

N 

B 

O 

C 

^o^nA'tAe^  o/u^mJ^ 

._._   / 

P 

^ac^ai^     ^    ^, 

—  J 

'^x                D 

^c^\^/,     M^'^, 

^ean,    J^mod, 

Q 

E 

R 

...  / 

F 

.___  / 

s 

^lencel,    .^./V  "g!, 

..  2 

G 

T 

i^n(yfna<f,   JSS    ^., 

...   / 

H 

__-  s 

u 

1  J 

___  s 

V 

K 

w 

7!f^e^^  ^w^ 

.__  S 

L 

....  J 

X  Y 

M 

Z 

36 


LEDG-ER-SET  II. 


'6ic^ei 


?<?. 


'/^ 


S 


d^  ^otm, 


sooo 


36y  <^/KeMe., 


^000 


#?  ^a^eOen 


o^na4. 


f/f^ 


7s^? 

/cf// 

^/u. 

/ 

C%    i^^^l5._. 

/ 

^ 

so 

^u. 

/ 

t^^    TiSadA, 

/ 

/<^ 

// 

/s 

//             // 

i' 

/ 

^/ 

^y^utu 

/ 

//          //     130  K 

^ 

^^ 

Ji? 

// 

/s 

10 

^ 

S2 

r<^ 


c%   t/ftcMa.^ 


^0 


i. 


^<^ 


^u    JOa<»A, 


^0 


rv       ^  ^;^ 


<Ji^^^«?< 


fy 


/f// 

/cf// 

— ' 

^/u. 

^ 

c%  >yWaJc., 

/ 

^^ 

,y^au 

/J 

^u    Jaa^, 

2S 

u^ay 

i' 

//        // 

-/ 

2J 

SO 

// 

ss 

//         // 

Hf/ 

SJ 

// 

/i" 

//         y/ 

^ 

J 

2J 

cf^ 

S^ 

SJ 

SJ 

1 

37 


2 

LEDGER, 

-SET 

II. 

m-^ 

^a^m    U^.  j(!6m^i4€m.            ^f' 

/cf^ 

^u. 

J 

C%   ty/UMe,, 

/ 

s/ 

u^M^ 

/ 

//        // 

80  00 

^ 

^p 

^ 


J^iiaac  tyiei^en4. 


'/r^ 


c%    <y%€aJe,  f 


//  // 


eo  50 

30 

so  so 


.^r^ 


.yfca 


^ 


/^ 


^ 


.;?<^ 


u 


^^Ma^ 


'J- 


^leec^j 


f/^ 


/<?!$/ 
^i. 

<r 

C%    ,y(CcMe,f 

2 

2<f 

s^ 

/d-6/ 

s/ 

s 

ss 

s^ 

ss 

s^ 

ss 

1 

{^ml 


/S'6'/ 

/cf^ 

^/u. 

/{} 

0%   t^uUe.f 

i- 

^/ 

.iT^ 

^u. 

// 

(^uAii/:d^^. 

/ 

^/ 

.iT^ 

v^ay 

/ 

8«  5« 

s;  60 

«8  00 

s 

i*,/^ 

38 


LEDGER -SET  11. 


8 


f^ 


/s<f/ 

/S'^/ 

. 

Jfu. 

c%  tyKeue., 
//        // 

51  50 
SO 
81  50 

s 

sp 

so 

<J^H. 

so 

<5^  lacKin, 

^ 

so 

0^       ^&^  W.  ^M       f'^ 


/S(f/ 

y^/u. 

/6 

c%  tyfMie,, 

s 

s 

so 

tyflay 

?r 

//         // 

ST  75 

/ 

s^ 

2S 

J 

V 

c> 

</ 

y. 

/ 
( 

up 

naia, 

r^ 

7sW 

/cf^/ 

^/u. 

// 

<%  ^.  'd  0u/el, 

S 

ST 

so 

^/u. 

so 

^u    T^aufA^ 

s 

so 

// 

so 

c%  ,yfC<Ma,, 

s 

^7 

OS 

•^ 

/ 

//         // 

1R5  05 
50 
851)5 

^ 

/o 

so 

m-f    ^n  'f.  ^Sct^/4  /.,      f^ 


u^/ 

/cf^ 

^/u. 

ss 

<s/a  ,/KMe,, 

^ 

/O 

SO 

%y€Cay 

ST 

,38y  e^*n<A.t4S<) 

7 

/cf 

,/f(ay 

so 

//        // 

34  50 
18 
j«  50 

.6 

1 

39 


A 

LEDGER 

-SET  II. 

/S(f/ 

/s-^/ 

d^/H. 

i'/ 

(%  .y^^e. 

^ 

/p 

so 

ty/Cau 

SO 

<you   TbOifn, 

SJ 

%/ftau 

J 

//        // 

/ 

/s 

JO 

- 

ss 

^          '^Ja^  ^  ^i^mca,            f^f" 

/,»? 

i/ftay 

P 

c%  ^Ceue, 

s 

p 

/^s- 

// 

2S 

/ 

(^0 

40 


CASH  BOOK,- SET  II. 


/ 

2 
J 

t^&fnae*ntL^  on.  ^ana, 

J^ecetttef/j^oi/  Q/a^  ^iw  t/ay,   Aof  •^tc^e'^, 

,,      ^iauaae  on  xy/lode., 
Mace*ve«^^cH/  e/a^  *iw  </ay,   Aei/  *fc**»»^_, 

^a^i/Ml^cU  an%    c/  7PQj^eJ, 
xAece*veayof  Q/aM  '/Atj  e/ay,  AeU  Atc^eAi, 

/SCO 

//s 

/rs 

2S 

20 

S 

/s 

s 

cf/ 

2S 

■ 

^ 

Mece4^M»/ yoV  QAiM  *Jw  c/ay,  /teU  Ati^AeAf, 

2 

SO 

//o 

SO 

S 

/ 

so 

,,         ,,      /luAuna  Jz.taM*h  7rtncuyu*, 

2 

so 

Mecetit^/oi/  e/aUJ  «^W  e/ay,  AeU  Ato^tAf, 

/S'J 

2S 

d 

,,         t>^  o/amed    K>am/f{te/t  on    f^ , 
^a<iA  ^dlif'j  ^^/^^ 
Mefet'ue<//oi/  o/a&J  ^/tt^  e/ay,  Aely  AecAe^J, 

tMautficty  on  Aatu/, 

m 

/o 
/oo 

/S 
2/pp 

<rs 

$2<F/ 

2S 

22S/ 

2J 

<r 

KAja/ance'  ^louan/^  e/eiton, 
^aa^  /  ^o^.    3Sa/iS  <%^n», 

Mece*uet//oU  QMUd  Mtd  e/ay,  /tcl/  /tc^Ai, 

s/pp 
s/s 

<rs 

/ 

20 

^ 

/ 

,,     ^eH/  o/Xott*    T&etde, 

%iaiu'ec/  ouel. 

20 

n/4  <rs 

J2 

20 

41 


CASH  BOOK -SET  IL 


^i. 


// 
/J 


/s 


..^koefoniL^  oval, 

Hiea/^of  &cfUJ  €ne<l  Miy,    Aoi/  «c^c*&, 

„         ,^e>o4--nee/iel  on    i^ , 
yf         &inaM<<fem<i  oj^  Gaa/ien'iley 
veaj/ol'  Q7a^  ^ntj  c/ay^    /lei/  ^tc^<iff 

y,        on   t^t/cc/  cAtinf/uie, 
^^ecatitea  -/oi/' Q/a'^  9nt<i  aaUy  /lei/  '/*hne^, 
y,         Oyf  ^uiu\i    JfAeeuicKy    on    /c  ^ 
jf       /^"^  Q^/eJ  vntj  aay,  ^el^  «ci^«6[. 


■anca'  on 


yy  J^aiAen^l/Col  ^JifViaelena  Q/i[tH£y 

.^ecet^itet^ ^oU  Q/a-M  ^nt<f  aayy  ^ely  rtcnis^. 


£^ecefv^a  j/oU  Q/a-KJ  'f-ntj  aay^  /lel/  •ftcKetd, 
//  //  //  // 


'ance'  on 


na  1  <rj 


//o 


/s 


rs 


/j- 


2S0 
/ 


2S 


SO 


u 


SJS^ 


S<r/J\  JS\  SS'^S 


SSS/f 


S/0 

so 

//2 


JS/J 


^7 


rs 
s/ 


so 


^/ 


n 


/ 

/ 

sd' 


// 


ss/s 


ss 


so 
so 


^/ 


42 


CASH  BOOK -SET  II. 


e-' 


/<S'/f/ 

— = — 

-~^^ 

^i. 

2$ 

..Aecsti^ea ^oi/  o/a^  -t^Jw  aay,  /lei/  ^usKe^, 

s/u 

/OS 

4/ 

20 

/o 
ss 

U 

//                //                    //                 // 

/<S'0 

s^ 

2<f 

,^a4'<^  ^oo^^^Ael  on    A , 
^^eceti^et/^oU  Q^i^  ^W  t/a^,  Aei/  ^4iMe/^, 
//               //                    //                 /• 

P'S' 

/^ 

/s 

sr 

J^ecetvea  ^o1/  Q/a^  ^^ntj  t/ay,  Atf  ^tc^e^, 
K^auinc^  on  Aana, 

/7S 

1 

<f/ 

/o 
Scops' 

rs 

SPP2   /jT 

Jpp2 

/^ 

sp 

s<rp<r 

7^ 

/ 

2^ 

so 
7S 

so 

Mece4ifet//ol'  o/a^  ^AtJ  e/ay,  /tef  ^icite^, 
,,         0/  o/ameJ  t^%'/ioa'/ely  on/  M , 

,,      ^ol/  e/«^  l^W  (/ay,  /leU  ^«^<^^ 

so 
^0 

/o 

^/J/ 

<fo 

4/S/ 

ss 

jf/S7 

ss 

43 


CASH  BOOK -SET 


II. 


r^ 


f/?^ 


/s6'/ 

%/Hay 

/ 

^OMnce^  Off  ^ana, 

^/J/ 

ifO 

/o 

2 

/ 

JO 

S 

2000 

/ 

^P7 

a 

JO 

/o 

,,          o/  o/jaac  Q/^eve-nJ^    on-    7^ , 

JO 

/2 

,,         o^  3^,    oo.    <^'n-ru:y  on-  %, 

JO 

■ 

<r<f 

/^ 

SSJ 

2S 

/S 

2S 

// 

/2 

20 

„     ya.  ^^ 

/O 

24 

2/ 

// 

r2S 

2S 

f,        o/ <M.  t/».  d^tnney,  *n^<u^o/  M, 

6/ 

ss 

26 

26" 

Mecei^eo^  j/cH/    o/a^  ^Atj   Tfee^, 

S^J 

2^ 

SO 

^autnce^  on  Aana, 

SJ 

2i^0<^ 

26- 

6^40 

<r<? 

dd^O 

SS' 

^OMnce^  en  Aanc/, 

2P0<i' 

2d- 

44 


STATEMENT. 


"The  facts  embraced  in  the  following  statement  are  gathered 
from  the  preceding  Ledger  and  Cash  Book,  and  will  afford  a  more 
concise  and  satisfactory  view  of  the  true  purport  of  Book-keeping 
than  could  be  enforced  by  any  other  form  of  argument.  "  It  must 
be  borne  in  mind  that  any  statement  which  shows  the  condition  of 
business  must  embrace  a  list  of  its  property  and  debts ;  or,  in  busi- 
ness language,  its  resources  and  liabilities;  and,  consequently,  "  any 
system  of  Book-keeping  which  will  enable  one  the  most  easily  and 
certainly  to  get  at  these  facts,  must — other  things  being  equal — bo 
the  best  system. 

The  variety  of  resources  and  liabilities  in  the  business  here  repre- 
sented is  quite  limited,  and  requires,  therefore,  fewer  aids  than  would 
otherwise  be  essential.  In  fact,  the  Cash  Book  and  Ledger,  in  con- 
nection with  an  inventory  of  unsold  merchandise,  afford  all  the 
necessary  results  for  the  purposes  of  a  statement. 


.  Resources. 


rf 


1.  From  Ledger  Accounts. — '*  Balances  duo  from  persons. 

James  Campbell, 

David  P.  Johnson, 

Isaac  Stevens, 

Robert  Domarest, 

James  Atwater, 

James  W.  Lusk, 

S.S.  Packard, 

John  J.  Howell,  Jr., 

Robert  C.  Spencer, 

2.  FroTn  Cash  Book. — "  Balance  of  Cash  on  band, .... 

3.  From  Inventory. — "Merchandise  on  hand,*. 


_  Liabilities. 


Ti 


"  From  Ledger  Accounts. — Balance  duo  Roberts,  Rhodes 
&  Company, 


Present  "Woktii,. 


$120 
80 
30 
28 
31 
37 
85 
16 
69 

2908 
1075 


$4483 


2000 


26 


$2483 


26 


*  The  Taluo  of  merchandiso  on  hanil  has  neeessarlljr  to  be  Msumed. 
nacortuiaud  by  takiug  an  actual  iavoatory  or  "  Account  of  stock." 


In  biulness  it  would  be 


45 


STATEMENT. 

From  the  foregoing  abstract  we  ascertain  the  present 

Avorth  or  net  capital  of  the  concern  to  be, $248'}  26 

From  which,  if  we  deduct  the  investment  at  commencing,     1 500 
We  shall  show  the  net  gain  during  the  two  months  to  be,     $983  26 

From  these  illustrations  we  gather  the  following 

RULES. 

^^1^  To  ascertain  the  net  capital,  or  present  woeth,  subtract  t/ie 
liabilities  J^rom  the  resources. 

"2.   To  ascertain  the  net  gain  during  business^  subtract  the  net 
capital  at  commencing  from  the  net  capital  at  closing. 


EXAMPLES    FOR    PRACTICE. 


The  following  examples  are  given  to  make  the  student  more  fami- 
liar with  the  principles  embraced  in  the  j)receding  set ;  and  espe- 
cially to  enforce  the  theory  of  the  foregoing  rules.  He  should  bo 
required,  not  only  to  produce  the  proper  results,  but  in  each  case 
to  render  a  written  statement,  similar  to  that  on  the  preceding  page. 

ExAifPLE  I. — A  merchant  commenced  business  with  a  capital  of 
$5000.  At  the  end  of  the  year  he  gathers  from  his  books  the  fol- 
lowing facts:  Amount  of  Cash  received,  $15,000;  Amount  paid 
out,  $10,500  ;  A.  B.'s  account  stands.  Dr.  $1500  ;  Cr.  $1000  ;  C.  D.'s, 
Dr.  $4000  ;  Cr.  $3500 ;  E.  F.'s,  Dr.  $975  ;  Cr.  $450 ;  G.  Il.'s,  Dr. 
$483  75  ;  Cr.  $300  ;  Merchandise  on  hand,  as  per  inventory,  $2750 ; 
Amount  owing  to  J.  K.,  $1500.  Jiequired,  the  net  capital  at  closing, 
and  the  net  gain  during  busiiiess. 

Ex^vjiPLE  II. — ^A.  and  B.  commence  business  with  the  following 
resources:  Cash,  $3000  ;  Xotes,  $1500;  Merchandise,  $3500 ;  Real 
Estate,  $10,000;  Balance  due  on  personal  accounts,  $12,500.  At 
the  end  of  six  months,  their  resources  and  liabilities  are  as  follows : 
Cash  on  hand,  $1500;  Cash  in  Bank,  $4000;  Kotes,  $3500;  Mer- 
chandise, $3750  ;  Real  Estate,  $15,000 ;  Due  on  Personal  Accounts, 
$5000  ; — Amount  due  from  the  firm,  on  their  notes,  $750  ;  Amount 
due  to  persons  on  account,  $1500.  Required^  the  capital  at  com- 
mencing/ at  dosing/  and  the  net  gain. 

46 


EXERCISES   FOR   THE   LEARNER, 
s  e:  c  o  N  r>     series. 


The  following  transactions  shonkl  be  written  np  with  great  caret 
Let  the  student  use  all  the  books  introduced  in  Set  II.,  and  in  the 
same  manner. 

Memoranda. 

July  1.  Commenced  Business  with  Cash  on  hand,  $1500. — Bo't 
of  Harrison  Scott  on  %,  50  Bbls.  Genesee  Flour,  @  ^8 ;  2  Hhds. 
Molasses,  140  Gals.,  @  40'f;  12  Boxes  Soap,  @  $4;  6  Half  Chests 
Y.  II.  Te.a,  ®  $20.-4-Paid  for  Stationery  and  Sundry  Expenses,  $50. 
-4lec'd  Cash,  for  Petty  Sales,  $16.-2.^  Sold  J.  W.  Husted,  on  %, 
10  Bbls.  Genesee  Flour,  ®  $9  25 ;  4  Boxes  Soap,  ®  $4  25. — Paid 
Brayage,  $2. — Rec'd  Ca.sh  for  Petty  Sales,  $50. — 3.^  Sold  John 
Banks  on  %,  15  Bbls.  Flour,  ®  $9  50;  3  Half  Chests  Tea,  @  $25.— 
'Paid  Harrison  Scott,  Cash  on  %,  $200. — Rec'd  Cash  for  Petty  Sales, 
$75.— 4."' Bo't  of  Henry  P.  Smith,  on  %,  10  Hhds.  Molasses,  1200 
Gals^  @  50'^ ;  12  Boxes  Havana  Sugar,  3750  lbs.,  ®  6f. — Sold  J.  C. 
^JBdu  %,  10  Gals.  Molasses,  @  75^ ;  1  Bbl.  Flour,  ©  $9.— Rec'd 
(^■for  Petty  Sales,  $110,-5.  Sold  Henry  P.  Smith,  on  %,  5  Bbls. 
Flour,  @  $9. — Received  Cash  on  %  of*  John  B.anks,  $50.— Rec'd 
Cash  for  Sales  this  day,  $115  75. — 6.  Paid  Cash  for  Stationery, 
$5  50.— Rec'd  Cash  for  Sales  this  day,  $110  75.-8.  Bo't  of  C.  J. 
Judd,  on  %,  5  Bbls.  Coffee  Sugar,  1000  lbs.,  @  G^f  ;  6  Hhds.  Molas- 
ses, 4000  Gals.,  &  50f . — Rec'd  Cash  for  Sales  this  day,  $75  50.— :9. 
Paid  Cash  for  Clerk  Hire,  $50.-^Received  for  Sales  this  day,  $50. — 
10.  Rec'd  Cash  for  Sales  this  day,  $83  30.-11.  Sold  John  Banks, 
on  %,  10  Gals.  Molasses,  ®  60^ ;  50  lbs.  Coffee  Sugft*,  ®  7^ ;  1  Bbl. 
Flour,  ®  $9.— Rec'd  Cash  for  Sales  this  day,  $08  50.-12.  Paid 
C.  J.  Judd  Cash  on  %,  $500. — Rec'd  Cash  for  Sales  this  day,  $75. 
— 13.  Rec'd  Cash  for  Sales  this  day,  $117  50.-15.  Bo't  of  Thomas 
Palmer  on  %,  3  Bbls.  Soda  Crackers,  ®  $4  20;  12  Boxes  Butter 
Crackers,  360  lbs.,  ®  6* ;  40  Loaves  Bread,  ®  10*. — P.aid  Porterage 
in  Cash,  $3 ;  For  Cleaning  Store,  $5. — Rec'd  Cash  for  Sales  thia 

47 


QUESTIONS    FOR    REVIEW. 

day,  |123  Y5. — 16.  Paid  James  Smith,  Cash  for  Repairing  Store, 
$25. — Sold  Rob't  Hay  ward,  on  %,  1  Bbl.  Soda  Crackers,  @  $5  ;  3 
Boxes  Butter  Crackers,  90  lbs.,  ®  7^. — Rec'd  Cash  for  Sales  this 
day,  $97  50. — 17.  Rec'd  Cash  for  Sales  this  day,  $125  75. — la 
Sold  W.  F.  Normaa  on  %,  100  lbs.  Sugar,  @  7^ ;  50  Gals.  Mo- 
lasses, @  fiO? ;  60  lbs.  Sugar,  @  7*. — Paid  Smith  &  McDougal  for 
Printing  Circulars,  $5  50. — Rec'd  Cash  for  Sales  tliis  day,  $88  93. — 
19.  Paid  Cash  for  Postage  Stamps,  $3  ;  Letter  Paper,  $5.— Rec'd 
Cash  for  Sales  this  day,  $98  37. — ^20.  Rec'd  Cash  for  Sales  this 
day,  $117  95.-22.  Rec'd  Cash  on  %  of  John  Banks,  $50.— Sold 
Robert  Ilayward  on  %,  30  Gals.  Molasses,  @  60^ ;  2  H'f  Chests  Tea, 
®  $25.— Rec'd  Cash  for  Sales  this  day,  $84  28.-23.  Rec'd  Cash 
on  %  of  Rob't  Hayward,  $30. — Rec'd  Cash  for  Sales  this  day,  $75. 
—24.  Sold  J.  C.  Buttre  on  %,  1  Hhd.  Molasses,  75  Gals.,  ®  56*.— 
Rec'd  for  Sales  this  day,  $65  75.-25.  Rec'd  Cash  of  Rob't  Hay- 
ward,  in  full  of  %,  $49  30.— Rec'd  Cash  for  Sales  thi^  day,  $78  25. 
—26.  Rec'd  Cash  for  Sales  this  day,  $48  95.-27.  Paid  Clerk's 
Sakry  in  Cash,  $50.— Rec'd  Cash  on  %  of  J.  C.  Hall,  $16  50.— 
Pa^d  Henry  P.  Smith,  Cash  in  full  of  %,  $780.— Rec'd  Cash  for 
Sales  this  day,  $81  38. — Mdse.  unsold,  amounts,  per  Inventory,  to 
$1500.  ^ . 

QUESTIONS    FOR    REVIEW. 

EEMAEKS,    PAGE    28. 

I.  "VThat  more  perfect  results  ars  shown  in  Set  II  ?  2.  'What  important  end  is 
accomplished  in  keeping  a  Cash  Book?  3.  What  is  one  of  the  most  essential  hooka 
in  business  ?  4.  How  may  the  amount  of  cash  on  hand  be  ascertained  without  the 
use  of  a  Cash  Book  ?  5.  What  tests  are  omitted  if  we  depend  solely  upon  counting 
the  cash  ?  6.  Wliat  advantages  are  there  in  a  faithful  record  of  receipts  and  dis- 
bursements of  cash?  7.  What  will  be  shown  at  any  time  by  a  Cash  Book  properly 
kept?  8.  How  often  in  business  is  it  customary  to  clo«e  up  the  Cash  Book? 
9.  How  often  is  the  Cash  Book,  used  in  this  connection,  closed?  10.  "W^hat  ia  a  dc- 
girable  feature  in  business  record  ? 

♦  STATEMENT,     PAGE    45.  , 

II.  From  what  sources  are  the  facts  exhibited  in  the  SUtement  on  page  43  ob- 
tained? 12.  What  is  an  indispensable  requisite  to  any  statement  showing  the  con- 
dition of  business?  13.  W'hat  is  the  sure  test  of  superiority  in  a  system  of  Book- 
keeping? 14.  What  class  of  resources  are  found  in  the  Ledger?  15.  W'hat.  in  the 
Cash  Book?  16.  What  ascertained  only  from  Inventor}'?  17.  How  are  our  liabUi- 
ties  ascertained?  18.  What  is  the  rule  for  ascertaining  the  present  viorth  of  a  con- 
cern?    19.  What,  for  ascertaining  the  gain  during  business  1 

48 


SET    III. 


WHOLESALE  DRY  GOODS  BUSINESS. 


(PARTNERSHIP.) 


DAY  BOOK;  LEDGER,  SALES  BOOK,  CASH 
BOOK,  AND  BILL  BOOK. 

IHTH   STATEMEirr   OF  AFFAIRS  AT  THE  COMSIEXCEMENT,   AND  ALSO  AT  THE  CLOSE 


"Svis.'vw,e%%  -K^wev^e. 


REMARKS. 


In  the  set  which  follows  we  have  enlarged  the  area  of  our  labor, 
by  enlarging  our  business,  and  adding  somewhat  to  the  variety  of 
our  resources  and  liabilities.  The  peculiar  feature  of  this  set  con- 
sists in  the  auxiliary  books,  which  are  introduced  for  the  double 
purpose  of  teaching  their  use,  and  preserving  a  more  complete 
record  of  the  transactions.  The  form  of  Cash  Book  given  in  this 
connection  differs  from  that  in  Set  II,  in  its  arrangement  of  receipts 
and  payments.  This  form  is  the  one  in  common  use,  and  is  prefer- 
able to  the  other,  mainly  on  account  of  its  complete  separation  of 
the  two  conditions  named ;  the  receipts  being  placed  on  one  page, 
and  the  payments  on  the  othei*.  The  Bill  Book  and  Sales  Book  will 
explain  themselves.  There  are  more  comprehensive  forms  for  the 
Bill  Book  in  use,  but  the  form  here  submitted  is  the  one  more  gen- 
erally used,  and  has  the  merit  of  sinnjlicity  and  plainness.  The 
Sales  Book  is  one  of  the  most  convenient  auxiliaries  a  merchant  can 
adopt ;  and  particularly  where  any  amount  of  wholesaling  or  gen- 
eral credit  business  is  done.  It  is  not  absolutely  essential  that  the 
credit  sales  should  be  entered  on  the  Day  Book,  as  they  may  easily 
be  posted  from  the  Sales  Book  direct ;  but  as  many  merchants  adopt 
the  plan  of  posting  only  from  the  Day  Book,  and  as  there  are  some 
very  good  reasons  for  adopting  this  policy,  we  have  here  given 
it  practical  endorsement.  The  initials,  "  D.  B.,"  "  C.  B.,"  and 
"  B.  B.,"  in  the  margin  of  the  Sales  Book,  (standing  for  Day  Book, 
Cash  Book,  and  Bill  Book)  will  indicate  the  books  wherein  are  en. 
tered  the  various  resources  received  for  merchandise.  The  Sales 
Book  is  not,  properly  speaking,  a  book  of  result\^  and  is  not  con- 
sulted in  making  up  our  hst  of  resources  and  liabilities. 

In  the  former  set  the  result  of  the  business  was  a  gain ;  in  this  a 
loss  has  been  sustained,  which  is  shared  equally  by  the  two  partners. 

In  writing  up  this  set  the  student  should  be  required  to  observe 
the  order  of  dates  in  the  various  books,  and  complete  the  record  of 
each  transaction  before  pi'oceeding  to  the  next.  For  example :  On 
the  1st  of  July,  Robert  Van  Schaick  purchased  of  us  a  bill  of  mer- 
chandise for  which  he  paid  cash.  This  entry  is  first  made  in  the 
Sales  Book,  from  which  the  amount  is  transferred  to  the  Cash  Book, 
and  marked  "  C.  B."  in  the  margin  of  the  Sales  Book.  The  suc- 
ceeding entries  in  the  Sales  Book  are,  in  the  same  manner,  trans- 
ferred to  the  appropriate  books  which  are  indicated  in  the  margin. 

50 


DAY  BOOK -SET  IIL 


G^^^W^^  /^^^^^   ^  ^^^ 

s^KeicnantuJe,  aJ  /tei/  o/tpven/oly, 

Oua^oHceJ  e/u&'  erf  xyeldona-t  tJ^ccenHW,   ♦«:.  / 

/soo 

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srs 

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M.   M   ^Aa//on, 

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c^wi'  Q^ited^fnetv/,   aJ  /<^U^^/j^  : 

er'^ouiie^  ant^  <^o*,   tfo^uteaf'  <z«o 

sooo 

r 

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r 

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51 


DAY  BOOK -SET  III. 

3.  /^// 


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42 


DAY  BOOK -SET  III. 


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nsTDEX  TO  LEDG-ER-SET  III. 


^<w;  ^.  ^., / 

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56 


LEDGER -SET  III. 


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57 


8 

LEDQER, 

-SET  III. 

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64 


SET  III. 


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V 


STATEMENT 

SHOWING  THE  CONDITION  OF  BUSINESS  AT  THE  CLOSE  OF  SET  III. 


Kesonrces, 

Dr. 

Cr. 

Balance. 

1.  FroTti  Ledger  Accounts. 

Lorenzo  Fairbanks. 

750 
192 

23 
180 

82 
132 

37 
216 
182 

41 

88 
24 
55 
50 
40 

350 

60 
30 

75 

400 
192 

23 
130 

62 
132 

37 
216 
107 

5881 

1620 

3000 
5000 

James  Johnson 

Benjamin  Payn 

Amos  Dean 

41 

Victor  M.  Rice 

James  Sheldon 

88 
24 
55 
50 
40 

William  Shepard 

John  Belden 

Clias.  A.  Seeley 

2.  F)'om  Cash  Book. — Balance  of  Cash  on  h< 

3.  From  BiU  Book. 

S.  S.  Packard's  Note,  duo  Sept  13 

E  H  Bender's,     "       "       "        5 

ind. . . . 

94 

. .. . 



.  .$1000 
.     108 
.     173 
.      339 

00 
20 
00 
00 

Calvin  S  Sill's,     "       "    Oct.    13 

?0 

4.  From  Inventory. 

Merchandise  unsold 

Tiiabilitiefj. 

F-om  Bill  Book—lUotQ  favor  ClafHin,  Mcllen 
Pkesevt  WoRxn  

&Co.  . 

16794 
575 

12 

16219 

n 

To  ascertain  the  net  loss  of  the  concern,  and  the  present  worth 
,  of  each  partner,  we  liave  the  following  facts  : 

H,  B.  Bryant  invested $9075 

"         drew  out 75 

Net  Investment, 


n.  D.  Stratton  invested $8000 

"  drew  out 75 

Net  Inveetment 

Total  Net  Investment 

Deduct  Present  Worth 

Leaves  Net  Loss 

H.  B.  Bryant's  Net  Investment $9000 

Less  J  Net  Loss 352  94 

Leaves  Present  Worth 

H.  D.  Stratton's  Net  Investment $7925 

Less  J  Net  Loss • 352  94 

Leaves  Present  Worth 

Total  Present  Worth 

67 


$9000 


7925 


$16925 
16219  12 
$7U5  88 


8647  0« 


7572  06 
$16219  12 


EXAMPLES    FOR    PRACTICE. 

From  the  foregoing  statement  we  deduce  the  following 

RULES. 

1.  To  ascertain  the  net  loss  during  busmess,  subtract   the  net 

capital  at  closing  from  the  net  capital  at  commencing. 

2.  To  ascertain  the  net  capital  of  each  partner  at  closing,  sub- 

tract his  NET  LOSS  from,  or  add  his  net  gain  to  his  net 

INVESTMENT. 


EXAMPLES    FOR    PRACTICE. 


Example  I. — A.  commenced  business  with  a  cash  capital  of 
$8750.  At  the  close  of  the  year  his  resources  and  liabilities  Avere 
as  follows :  Cash  on  hand,  |3700  ;  Notes  on  hand,  $7000  ;  Mer- 
chandise unsold,  $2500  ;  Amounts  owing  on  Personal  Accounts, 
$2000 ; — He  owes  on  notes,  $5000  ;  To  various  persons,  $2500. 
What  has  been. his  loss  ?      JVhat  is  his  net  capital  at  closing.^ 

Example  II. — E.  and  F,  enter  into  copartnership  on  equal  terms, 
each  investing  at  commencement,  $10,000;  and  each  withdrawing 
during  the  business,  $1500.  At  the  close  of  a  certain  period  the 
following  exhibit  shows  the  true  condition  of  their  afiairs :  Cash  on 
hand,  $500 ;  Balance  in  Bank,  $7000 ;  Due  them  on  Personal  Ac- 
counts, $5783  75,  of  which  $875  is  worthless;  Due  them  on  Notes, 
$0750;  Merchandise  on  hand,  $2700;  Real  Estate,  $5000;  Bank 
Stock,  $3500;  They  owe  to  persons  on  account,  $10,000;  On 
Notes,  $5600.  ITave  they  gained  or  lost  in  business,  and  how 
much  ?      What  is  each  partner'' s  7iet  capital  at  closing  ? 

Example  III. — A.  B.  and  C.  are  partners.  A.  puts  into  the  con- 
cern, $7500 ;  B.,  $5300 ;  C,  $4700.  At  the  close  of  the  year  their 
books  exhibit  the  following  results:  John  Smith,  Dr.  $1700,  Cr. 
$500;  John  Parker,  Dr.  $1100,  Cr.  $975;  Abram  Schenck,  Dr. 
$1750,  Cr.  $2700  ;  Albert  Dodge,  Dr.,  $1859  38,  Cr.  $212  50  ;  Cash 
received,  $125,368  29;  Paid  out,  $122,480  23;  Notes  received, 
$1900;  Notes  disposed  of,  $1200;  Merchandise  unsold,  $2700; 
Value  of  Store  and  Fixtures,  $15,750;  A.  has  drawn  out  $2000; 
B.,  $1500;  C,  $785;  They  have  issued  Notes  to  the  amount  of 
$30,000,  of  which  they  have  redeemed  $25,800.  Required  a  written 
statement  xchich  shall  exhibit  all  these  facts,  as  also,  the  amount  of 
gain  or  loss  during  t/ie  business,  and  each  partner's  net  capital  at 
closing. 

68 


.f^ 


EXERCISES    FOR    THE    LEARNER. 

EXERCISES  FOR  THE  LEARNER. 

a?  H  I  R  33       SERIES. 


Menp-oranda. 
July  1.  S.  S.  Packard  and  John  R.  Penn  commence  business 
with  the  following  resources  and  liabilities;  gains  and  losses  to  be 
divided  equally.  S.  S.  Packard  invests  Cash,  $4000 ;  Merchandise^ 
$1750;  Notes,  as  follows:  one  for  $500,  in  favor  of  S.  S.  P.,  signed 
by  II.  B.  Bryant,  and  endoi-sed  by  W.  P,  Spencer,  dated  June  1, 
®  60  ds. ;  and  one  for  $700,  an  accepted  draft,  drawn  by  L.  S. 
Bliss  on  George  Claghorn,  May  1,  at  90  ds.  sight,  and  accepted 
May  3  ;  Personal  Accounts,  as  follows :  Henry  Fish,  $500  ;  Robert 
Fulton,  $750 ;  David  Coleman,  $900.  John  R.  Penn  invests,  Gash^ 
$500 ;  Beal  Estate,  $5000.— 2.^Sold  N".  Frederick,  on  %,  2  Doz. 
Gent's  Silk  Handkerchiefs,  24,  ®  40^? ;  6  Pes.  Amoskeag  Sheeting, 
130  Yds.,  @  10''' ;  4  do.  Mixed  Cassimeres,  100  Yds.,  ®  50<f. — Rec'd 
Cash  of  Henry  Fish,  in  full  of  %,  $500. — Paid  Cash  for  Stationery 
and  Printing,  $30. — 3.'  Sold  Ira  Packard  on  his  acceptance,  at  10 
days,  1  Case  Child's  Metallic  Tip  Shoes,  GO  Prs.,  ©50*;  2  do. 
Child's  Heel  Gaiters,  96  Prs.,  ®  G3'f ;  3  Pes.  English  Tweed,  27 
Yds.,  @  $1. — 4..^old  \Vm.  T.  Bush,  on  %,  4  Cases  Men's  Congress 
Gaiters,  96  Prs.,  @  $1  50 ;  2  do.  Gent's  Can.ada  Ties,  24  Prs.,  ® 
$1  75.7-^Sold  James  Magoon,  for  Cash,  1  Piece  Striped  Velvet,  10 
Yds.,  ®  $5  ;  6  do.  Paper  Cambrics,  72  Yds.,  ©  8t ;  10  do.  Lynn 
Cottons,  300  Yds.,  at  1  \f. — 5.  Paid  Cash  for  petty  Expenses,  $3  75. 
—Sold  Robert  Smith,  on  his  note  at  60  days,  3  Pes.  Lancaster 
Gingham,  125  Yds.,  ©10*;  6  do.  Scotch  Plaid,  240  Yds.,  @  13*.— 
Hd^ught  of  Star,  Barnum  &  Seeley,  Invoice  of  Merchandise,  amount- 
ing to  $5000  ;  Paid  Cash,  $2500  ;  Note,  at  .6  months,  $2500. — Q. 
Rec'd  Cash  on  %  of  David  Coleman,  $500.-^Sold  Roger  Williams, 
for  Cash,  1  Case  Misses  Cork  Sole  Shoes,  60  Prs.,  ®  75* ;  1  do. 
Gent's  Paris  Gaiters,  24  Prs.,  ©  $1  75.— Rec'd  Cash  for  petty  Sales, 
$25  50.— 7.^Sold  John  Fitch,  on  %,  3  Doz.  Elastic  Hoop  Skirts,  36, 
@  $2  50 ;  1  Doz.  "  Empress"  do.,  12,  ®  $2 ;  3  Pes.  Check  Mar- 
seilles, 30  Yds.,  @  50*.-^Sold  Samuel  Nash,  for  Casli,  3  Pes.  English 
Tweed,  27  Yds.,  @  $1 ;  6  do.  Corduroy,  250  Yds.',  ®  75*.— Rec'd 
Cash  Of  Wm.  T.  Bush,  on  %,  $50.— 9.  Paid  John  R.  Penn,  Cash 
on  private  %,  $100. — Paid  Cash  for  petty  Expenses,  $7  60. — 10. 

69 


EXERCISES    FOR    THE     LEARNER. 

^Sold  John  Anderson,  for  Cash,  3  Cases  Ladies'  Extra  Balmoral 
Boots,  144  Prs.,  @  $2 ;  2  Cases  Ladies'  "  Opera"  Gaiters,  48,  @ 
$1  75. — 12.Taid  S.  S.  Packard,  *Cash  on  private  %,  $75.— Sold 

Thomas  Hunter,  on  %,  6  Pes.  Merrimack  Prints,  210  Yds.,  @  9f ; 

5  do.  "Union"  Prints,  150  Yds.,  @  8^;  7  do.  Lancaster  Prints,  244 
Yds.,  @^  8^f;  4  do.  Orange  Prints,  120  Yds.,  ®  8^'^. — Rec'd  Cash 
for  petty  Sales,  $10  38.— 13.  Rec'd' Cash  of  David  Coleman,  in  full 
of  %,  $400.— ^old  John  Howard,  on  %,  3  Pes.  Lancaster  Gingham, 
125  Yds.,  @  lO'f ;  2  do.  French  Merino,  40  Yds.,  @  50$ ;  5  do.  Bar. 
Muslin,  90  Yds.,  ®  14^.— 14. ''Sold  Robert  Coons,  for  Cash,  6  Pes. 
Fancy  Linens,  36  Yds.,  @  $2  ;  5  do.  English  Prints,  200  Yds.,  0 
20'? ;  6  do.  Parametta  (Maroon),  300  Yds.,  @  75f. — Paid  Cash  for 
Repairing  Store,  $75.-16.  Rec'4  Cash  of  John  Fitch,  in  full  of  ^, 
$129.^^old  Henry  Fish,  on  %,  5  Pes.  Amoskeag  Stripes,  120  Yds., 

6  12if ;  4  do.  Pepperell  Sheeting,  160  Yds.,  ©10^;  4  do.  Auburn 
Sheeting,  120  Yds.,  ®  15^.-17.  Rec'd  Cash  in  full  of  Robert  Ful- 
ton's /Ss,  $750.-^Sold  Simon  "Walker,  on  his  note  at  60  days,  4  Cases 
Men's  Thick  Boots,  48  Prs.,  @  $1  25  ;  2  do.  Double-Soled  Boots, 
24  Prs.,  &  $1  50.— 20.^^"  Sold  Geo.  F.  Smith,  for  Cash,  2  Cases 
Women's  Walking  Shoes,  120  Prs.,  @  50'?;  2  do.  Jenny  Lind 
Gaiters,  24  Prs.,  ®  $1  15  ;  2  do.  "  Opera"  Gaiters,  24  Prs.,  ®  $1  75. 
— Paid  Clerk  hire  in  Cash,  $65. — 21.  Rec'd  Cash  of  Henry  Fish,  in 
fuU  of  fc,  $49. 


STATEMENT 

OF  RESOURCES  AND  LIABILITIES,  July  21. 


The  student  should  be  required  to  make  his  books  conform  to  the 
following  statement,  and  to  lender  the  same,  according  to  the  Ex- 
ample given  in  connection  with  Set  IH. 


Besources 

Personal  Accounts . . . . 

Notes,  receivable 

Cash 

Merchandise  (per  Inv.). 

Real  Estate 

Net  Loss 


$315 

54 

1467 

18 

6286 

49 

4500 

5000 

365 

79 

$16925 

00 

-Ijiabilities- 


Notes,  payable 

S.  S.  P.'s  Net  Investment 
J.R.  P.'s 


$2500 
9025 
5400 


$16925 


00 


70 


SET    IV. 


FURNITURE  AND  CABINET  BUSINESS. 


(TWO  PARTNERS,  ADMITTING  A  THIRD.) 


DAY  BOOK,  SALES  BOOK,  LEDGER,  CASH 
BOOK,  AND  TIME  BOOK. 

WITH  AX  IMPBOVED  METHOD  OF  USING  THE  SALES  BOOK  AS  A  PRINCIPAL  BOOK,  ANB 
KHBRACIlia  TALUABLB  IN8TBCCTI0NS  PEBTAINING  TO  A  CHAXOE  IN  BUSINESS. 


"Swsvweftft  '^Yos^cevovx*. 


REMARKS. 


It  is  intended  in  this  Set  to  realize,  as  nearly  as  may  be,  the 
capabilities  of  Single  Entry.  AVitli  this  view  we  have  inti'oduced 
several  new  features,  to  which  we  call  special  attention. 

It  has  been  the  pleasure  of  certain  authors  and  teachers  to  con- 
demn Single  Entry  Book-keeping  as  wholly  inadequate  to  the 
demands  of  business,  and,  therefore,  unworthy  of  consideration ; 
but  Avhile  we  are  behind  no  one  in  our  admiration  of  the  superior 
facilities  and  safeguards  of  Double  Entry,  we  are  not  at  all  pre- 
pared to  conclude  that  a  very  extensive  business  may  not  be  con- 
ducted Avith  perfect  safety,  having  no  better  record  than  that 
afforded  by  an  intelligent  and  faithful  ajipUcation  of  the  principles 
of  Single  Entry  Book-keeping.  This  fact,  together  Avith  another  of 
equal  force,  viz.,  that  hi  many  of  the,  first-class  houses  in  our  large 
commercial  cities.  Single  Entry  is  preferred,  affords  sufficient  cause 
for  attempting  to  present  its  strongest  points  to  the  public. 

The  materials  from  Avhich  the  transactions  in  this  Set  are  con- 
structed, Avere  obtained  from  an  extensive  cabinet  Avareliouse  in 
New  York,  and  the  routine  has  the  merit,  at  least,  of  being  busi- 
ness-like. The  forms  of  the  books,  and  arrangement  of  the  various 
records,  are  submitted  as  the  most  simple  and  practical  in  user 

One  important  feature  in  this  Set  is  the  use  of  the  Sales  Book 
distinct  from  the  Day  Book,  In  Set  III,  although  a  Sales  Book  is 
used,  all  sales  on  credit  are  first  transferred  to  the  Day  Book,  and 
from  thence  posted  into  the  Ledger.  Here,  however,  the  credit 
sales  are  posted  to  the  personal  accounts  directly  from  the  Sales 
Hook.  This  affords  a  great  saving  of  time,  and  is,  in  all  respects, 
quite  as  satisfactory.  The  figures  in  the  margin  of  the  Sales  Book 
refer  to  the  Ledger  p.'\ge  to  Avhich  the  amounts  are  posted  ;  the 
initials  "  C.  B."  and  "  B.  B."  indicate  that  the  result  of  the  sales 
thus  marked,  are  shown  in  the  Cash  Book  and  Bill  Book.  The 
former  of  these  is  exhibited  at  length ;  the  latter  has  been  omitted, 
although  it  is  expected  that  the  learner  will  supply  it,  after  the 
form  given  in  Set  HI. 

72 


REMARKS. 

The  taking  in  of  a  new  partner  forms  another  important  feature 
of  this  Set,  and  one  which  will  afford  the  learner  some  of  the  most 
valuable  hints  connected  with  Accounts.  It  is  a  settled  principle  in 
Accounts,  or  should  be,  that  whenever  any  change  in  the  business 
occurs,  the  existing  resources  and  liabilities  of  the  concern  should 
be  made  apparent ;  and,  consequently,  the  proprietors'  accounts 
sliould  represent  their  net  investment  at  the  time  of  the  change. 
The  same  rule  holds  good,  respecting  the  landmarks  of  business,  or 
tlie  financial  eras,  such  as  the  dose  of  a  fiscal  year,  or  any  import- 
ant event  which  makes  it  necessary  to  exhibit  on  the  main  books 
the  exact  condition  of  the  business. 

In  the  case  under  consideration,  the  existing  partners,  "  Lester 
and  Brown,"  pi-opose  to  admit  a  new  partner,  who  shall  invest 
equally  with  them,  and  share  equally  in  the  gains  and  losses.  The 
partners'  accotmts  now  show  only  their  original  investment ;  and 
it  will  be  evident  that,  if  the  new  partner  invests  an  amount  just 
equal  to  this,  lie  Avill  inijustly  become  a  joint-partner  in  tlie  gains 
which  have  already  accrued,  but  which  remain  unacknowledged  in 
the  business.  The  original  partners,  it  is  plain,  arc  entitled  to  all 
the  avails  of  the  concern  previous  to  admitting  the  new  partner, 
and  if  their  own  proper  accounts  do  not  show  what  this  net  amount 
is,  they  should  be  made  to.  Therefore,  before  deciding  how  much 
the  new  partner  should  invest  to  place  him  on  an  equal  footing 
with  his  associates,  it  becomes  necessary  to  credit  the  original  part- 
nei's  with  their  respective  gains  during  business.  With  this  view 
the  statement  on  the  third  page  of  the  Day  Book  is  made,  and  the 
partners  thereafter  credited,  each  with  his  net  gain.  The  partners' 
accounts  in  the  Ledger  are  then  closed  up,  and  the  balances  brought 
down  as  a  new  capital,  which  is,  of  course,  the  amount  that  the 
new  partner  must  invest. 

The  general  Statement  which  follows  this  Set  affords,  perhaps,  as 
convenient  a  form  for  such  statements  as  any  in  use.  The  student 
cannot  too  carefully  study  the  philosophy  of  these,  nor  be  too  par- 
ticular in  drawing  them  up^  as  to  their  neatness  and  perspicuity. 
An  obscure  or  insufficient  statement  of  a  business,  however  pros- 
perous and  satisfactory  maybe  the  condition  which  it  aims  to  show, 
is  like  a  good  story  so  bunglingly  told  that  its  chief  points  are  ob- 
scured, and  its  moral  entirely  lost  sight  of. 

For  simplicity,  directness,  and  efficiency,  the  forms  and  general 
\)lan  of  Set  IV  are  submitted  as  a  model. 

73 


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STATEMENT 


SHOWING  THE  CONDITION  OF  THE  BUSINESS  ON  THE  8l8T  OF  MAT. 


The  following  Statement  differs,  in  no  material  respect,  from  those 
which  have  preceded  it ;  the  only  diiference  being  in  the  form  of 
expressing  the  gains.  There  being  no  debts  owing  to  outside  par- 
ties, the  several  amounts  due  the  membei's  of  the  firm  constitute 
the  only  liabilities.  The  sum  of  these  amounts,  or  the  total  present 
worth,  must,  of  course,  equal  the  sum  of  the  resources. 


-  Resonroes. 

1.  From  Ledger  Accounts. — Balances  duo : 

A.  A.  Low, 

$825 

66 

67 

36 

12000 

455 

1003 

1016 

4000 
875 
500  1 

02 
50 

$20823 

H.  W.  Clark 

R.  Bannister 

Joseph  Brooks 

Central  Bank 

Steamer  Isaac  Newton 

2.  From  Cash  Book. — Balance  of  Cash  ou  hand 

3.  From  Bill  Book. — Notes  on  hand 

4.  IVom  Inventory. — Valuation  of  Property: 

Finished  Stock  on  hand 

Unfinished 

Tools  and  Implement 

62 

..  .     Liabilities. 

Jaraea  Lester's  Investment $6753  44 

,"            "       J  Net  Gain 187  73 

$6941 
6941 
6941 

17 
17 
18 

$20823 

"            "       Present  Worth 

Robert  Brown's  Investment $6753  44 

"             "        J  Net  Gain 187  73 

"            'i       Present  Worth 

Robert  Lincoln's  Investment $6753  44 

"             "         1  Net  Gain 187  74 

62 

91 


EXAMPLES   FOR   PRACTICE. 


The  principles  applied  in  the  foregoing  statement  have  been 
already  sufficiently  annovuiced.  The  examples  which  follow  are 
intended  to  affi)rd  the  student  more  ample  practice  in  the  important 
labor  of  expressing  financial  facts  through  appropriate  forms.  Let 
the  solutions  be  rendered  in  the  form  of  a  Business  Statement. 

Example  I. — A  and  B  are  equal  partners,  investing  each  $10,000. 
At  the  end  of  a  year  they  desire  to  take  C  into  co-partnership  upon 
condition  that  he  will  invest  equally  with  them,  and  share  equally 
in  the  results  of  the  business.  The  following  is  a  statement  of 
their  affiiirs  previous  to  uniting  with  C :  Personal  Accmmfs,  John 
Jones,  Dr.  $1500,  Cr.  $700;  Robert  Fulton,  Dr.  $5000;  James 
Webb,  Dr.  $1750,  Cr.  $1000;  Clarence  Shook,  Dr.  $5000, 
Cr.  $2500  ;  Lewis  Lyman,  Cr.  $4000 ;  Dr.  $3000 ;  W.  F.  Norman, 
Cr.  $2000;  Dr.  $1500;  Merchandise  unsold^  $7500;  JVotes  on 
hand^  $6000 ;  Notes  outstanding^  $2500 ;  Cash  on  hand,  $2000. 
Required,  a  statement  shoicing  the  gain  or  loss  during  businessy 
and  the  net  capital  of  each  partner  at  closing. 

ExAiiPLE  II. — C  and  D  enter  into  co-partnership,  C  to  furnish 
the  capital,  and  D  to  devote  his  time  to  the  business — gains  and 
losses  to  be  divided  equally.  C  invests  $10,000,  and  during  the 
year  withdraws  $2000.  D  withdraws  $1500.  At  the  close  of  the 
year,  they  have:  Cash,  $3000;  Personal  accounts,  $1500;  ]Mer- 
chandise,  $10,000;  Notes,  $1750  ;  they  oAve,  on  notes  and  personal 
accounts,  $5000.  Wliat  is  the  gain  or  loss  in  business  f  Wliat  is 
each  2)art)ier^s  capital  at  closing  ? 

Example  III. — J  and  K  enter  into  co-partnershiji  for  the  purpose 
of  conducting  a  Building  business ;  each  to  receive  interest  at  7^ 
on  his  net  investment,  and  the  gain  or  loss  to  be  divided  equally. 
J  invests :  Materials  and  Implements,  $5000  ;  Unfii!i|hed  contracts, 
$6750;  Notes,  $4800;  Personal  accounts,  $10,000;  and  the  firm 
assume  to  pay  for  him  a  liability  of  $1000.  K  invests:  Cash, 
$10,000;  Notes,  $15,000.  At  the  close  of  the  year,  their  books 
show  the  following  condition:  Cash  on  hand,  $15,000;  Notes, 
$5760 ;  Interest  on  same,  $500  ;  Materials  and  Implements  $18,000  ; 
PersonaF accounts,  $9400.  What  is  the  net  gain  or  loss?  What 
is  each  partner's  capital  at  closing  ? 

92 


EXERCISES   FOR   THE   LEARNER. 

B^OXJRTH       SERIES. 


June  1.  William  Jones  and  Thomas  Mason,  enter  into  co-part- 
nership. AViLLiAM  Jones  invests:  Mdse.  $4750;  Tools  and 
Implements,  8750;  Notes,  $1500;  Peter  Filkin's  %,  |500;  Robert 
Hail's  do.  $700. — Thomas  Mason  invests:  Cash,  $8200. — Sold 
W.  D.  Packard,  on  %,  1  set  Enameled  Furniture,  $75 ;  2  Hair 
Matrasses,  ®  $12  each;  1  Mahogany  Arm  Chair,  $15. — 2.  Paid 
Cash  for  Stationery,  $20. — Sold  Robert  Banks,  for  Cash,  1  doz. 
Dining  Chairs,  $20;  1  Hall  Stand,  $8;  1  Mahogany  Bedstead,  $12. 
— Paid  Cash  for  Lumber,  $25. — Sold  George  Chrysler,  on  his  note 
®  30  ds.,  1  Child's  Crib,  B.W.  $6  ;  1  Mahogany  Bureau,  $25  ;  1 
Tete-a-tete,  R.W.  $30.-3.  Received  Cash  of  Robert  Hall,  on  %, 
$300. — Sold  George  A.  Crocker,  on  %,  1  Hall  Stand,  $6  ;  2  Light 
Washstands,  1  @  $5,  and  1  ®  $7  ;  12  Kitchen  chairs,  @  75"?. — Sold 
John  Hall,  for  Cash,  1  French  Bedstead,  $15.-5.  Paid  Workmen, 
Cash  to  date,  $165.— Sold  A.  W.  Betts,  on  %,  10  Cane  Bottom 
Chairs,  @  $1  75"?  each ;  1  Black  Walnut  Tetc-a-tete,  $30  ;  1  Card 
Table,  $10;  3  small  Washstands,  @  $2  50"?  each. — Sold  James 
Morgan,  for  Cash,  1  Black  Walnut  Book-case,  $40 ;  1  Double-leaf 
Secretary,  $30. — 6.  Received  Cash  for  John  Jacobs'  note,  due  this 
day,  $500. — Sold  Charles  Williams,  on  his  note  ®  60  ds.,  1  Pair 
Ottomans,  $12  ;  1  Piano  Stool,  $7  ;  8  Brocatclle  Parlor  Chairs,  ®  $4 
each  ;  1  Sofo  Table,  $15.— Bo't.  of  Clark  Dunham,  on  ?^,  1  Lot 
Black  Walnut  Lumber,  $900.-7.  Sold  A.  W.  Betts,  on  %,  1 
Mahogany  Centre  Table,  $15;  1  Cottage  Bedstead,  $10 ;  1  Corner 
Stand,  $5.— Sold  James  W.  Lusk,  for  Cash,  1  Black  Walnut  Book- 
case, $50.— Received  Cash  in  full  of  Peter  Filkin's  %,  $500.-8.  Sold 
J.  C.  Buttre,  for  Cash,  1  Dressing  Bureau,  (serpentine  front)  $25  ; 
1  Study  Lounge,  $12  ;  1  Extension  Dining  Table,  $17. — Sold  Wm. 
T.  Brooks,  on  %,  1  Rosewood  Tete-a-tete,  $50. — 9.  Sold  James 
Moore,  for  Cash,  1  Quartette  Table,  $6  ;  6  Parlor  Chairs,  ®  $5  each ; 
1   Set  Enameled  Furniture,  $50. — 10.   Paid  Cash  for  Gas  Bill, 

$14  30*.— Received  Cash  of  A.  W.  Betts,  m  full  of  %, .—12. 

Paid  Workmen,  Cash  to  date,  $275. — Sold  Geo.  A.  Crocker,  on  %, 
G  Parlor  Chairs,®  $3;  12  Dining  Chairs,  ®  $1  50 ;  1  Mantel 
Clock,  $5. — 13.  Sold  Benj.  F.  Butler,  on  %,  8  doz.  Camp  Stools, 
96  ®  50"?  each  ;  1  Portable  Secretary,  $25. — Received  Cash  on  %, 
of  W.  D.  Packard,  $75.-15.  Sold  Robert  Hall,  on  %,  6  Gothio 
Chairs  ®  $5  each;  1  French  Bedstead,  $15 ;  2  WashstJftids,  ®  $4 

93 


EXERCISES    FOR    THE    LEARNER. 

each, — Sold  W.  J.  Curtisg,  for  Cash,  1  Book-case,  |40  ;  4  Library 
Chairs,  &  |7  each;  1  Large  Rocking  Chair,  $15. — 17.  Paid  Work- 
men, C>ash  to  date,  $218. — Received  Cash  of  Geo.  A.  Crocker,  iii 

full  of  %,  $ .—Sold  J.  C.  Banks,  for  Cash,  1  Double  Bedstead, 

$10 ;  1  Single  do.,  $9.-18.  Paid  Clark  Dunham,  Cash  on  %,  $500. 
— Sold  John  Banks,  on  his  note  @  30  ds.,  1  Bureau,  $30 ;  1  Sofa 
Bedstead,  $45.-19.  Sold  W.  D.  Packard,  on  %,  12  Kitchen  Chuirs, 
®  $1  each;  3  Common  Bedsteads,  ®  $5  each;  1  Office  Desk,  $15. 
Sold  W.  T.  Brooks,  on  %,  1  Carved  Rosewood  Center  Table,  $45. 

—20.  Received  Cash  of  W.  D.  Packard,  in  full  of  %,  $ .—21. 

Sold  Robert  Hall,  on  %,  1  Teacher's  Desk,  $25  ;  12  Dining  Chairs, 
®  $1  75f;  12  Cane  Bottom  Settees,®  $8  each.— 22.  Paid  Cash, 
Book-keeper's  salary,  $75. — Received  Cash,  in  full  of  William 
Carter's  note,  now  due,  $1000. — 24.  Paid  Workmen,  Cash  to  date, 
$193. — Sold  E.  A.  Charlton,  on  %,  50  Double  School  Desks,  @  $9 
each;  100  Chairs  for  same,  @  50^  each. — 25.  Sold  Wm.  Johnson, 
for  Casli,  1  Mahogany  Bedstead,  $20 ;  1  Marble  top  Washstand, 
$17. — Received  Cash  of  Robert  Hall,  on  %,  $200.-26.  Sold  John 
S.  Williams,  on  %,  6  Parlor  Chairs,  Brocatelle,  @  $5  each  ;  1  carved 
Rosewood  Center  Table,  $50;  1  Piano  Stool,  $10. — Paid  Cash,  on 
Drayage  %,  $50.-27.  Sold  Peter  Duff  for  Cash,  6  Office   Chairs, 

&  $2  50*  each.— Paid  Clark  Dunham,  Cash  in  full  of  %,  $ .— 

Received    Cash   of  Robert   Hall,  in   full  of  %,  $ .—29.  Sold 

William  Dallas,  on  %,  1  Mahogany  Sofa,  $35  ;  1  Rosewood  Arm 
Chair  $45,  1  Hall  Stand,  $7  ;  1  Tete-a-tete,  $30. 

New  Firm 


July  1.  Jones  and  Mason  have  this  day  associated  with  them 
George  F.  Smith,  who  is  to  invest  an  equal  amount  with  each  of 
the  foi-mer  partners,  and  share  equally  in  gains  and  losses.  The 
value  of  unsold  Merchandise  is  $5500 ;  of  Tools  and  Implements, 
$750 ;  the  other  resources  and  liabilities  can  be  ascertained  by 
reference  to  the  appropriate  book? .  Mr.  Smith  invests :  Cash,* 
. — Bo't  of  Henry  P.  Smith,  for  Cash,  a  quantity  of  Pine  Lum- 
ber amounting  to  $35a0. — Paid  Workmen,  Cash  to  date,  $175. — 
3.  Sold  John  S.  Williams,  on  %,  2  Bedsteads,  1  @  $6,  and  1  @ 
$10;  3  Washstands,  ®  $2  50*  each;  6  Kitchen  Chairs,  ®  $1  50* 
.each;  1  Lounge,  $15;  1  Secretary,  $25;  1  Bureau,  $18. — 5.  Sold 
E.  A.  Trotter,  for  Cash,  1  Black  Walnut  Book-case,  $60.— 
Sold  James  Thurber  for  Cash,  6  School  Desks,  (single)  @  $5  each  • 

•In  order  t<4ascertain  the  amount  of  Smith's  investment,   it  will  be  necessary  to  carry  tbo 
gains  to  the  partners'  accounts. — A  statement  bhould  be  made  similar  to  that  on  page  74. 

94 


EXEBCISES    FOR    THE    LEAR^TER. 

1  Teacher's  Desk,  $25 ;  2  Office  chairs,  ®  $7  50'^  each. — 6.  Sold 
Joseph  Wadsworth,  on  his  note  <a  30  ds.,  1  Rosewood  Tete-a-tete, 
$65;  2  Ottomans,  @  $10  each. — Received  Cash,  in  full  of  George 
Chrysler's  note  of  the  2d  ult.,  $61. — 8.  Paid  Workmen,  Cash  to 
date,  $218.-^|yd  James  McGrath,  for  Cash,  12  Dining  Chairs,  @ 
$2  each;  1  (3|HtaLounge,  $17  ;  1  Bureau,  $20. — 10.  Received  Cash, 
on  %  of  WiSt^||||6,  $50.— Sold  Steamer  Troy,  on  %,  2  Black 
Walnut  Sofas,  ®  $45  each  ;  3  Tete-a-tetes,  ®  $50  each ;'  24  Chairs, 

®  $7  each.— 11.  Received  Cash,  in  full  of  E.  A.  Charlton's  %,  $ . 

—Sold  W.  F.  Norman  for  Cash,  1  Black  Walnut  Book-case,  $60 ; 
1  Bureau,  $30.— Bo't.  of  Robert  Coon's  for  Cash,  lot  of  Mahogany 
Lumber,  amounting  to  $5700. — 15.  Paid  Workmen,  Cash  to  date, 
$212.-16.  Sold  Henry  Harper  for  Cash,  50  School  Desks,  @  $9 
each. — Received  Cash  of  John  S.  Williams,  on  %,  $90. — 17.  Sold 
Robert  S.  Hayward,  on  %,  1    Gothic  Book-case,   $75. — Received 

Cash  of  B.  F.  Butler,  in  full  of  %,  $ .—20.  Sold  John  S.Williams, 

on  %,  12  Parlor  Chairs,  @  $5  each. — 22.  Paid  Workmen,  Cash  to 
date,  $175.-25.  Paid  Gas  Bill  in  Cash,  $15.— Sold  Peter  McGrath 
for  Cash,  1  Sofa  Bedstead,  $50. — 29.  Paid  Workmen,  Cash  to  date, 
$219.— Paid  Cash  for  rent,  $100. 


STATEMENT. 

Showing  the  condition  of  the  business,  July  31. 


■ 

■R.fiRmirnfts. 

15000 

9826 

226 

95 

150 

67 

40>8 

75 

750 

05 
50 

26597 

— " 

Mdse.  unsold,        (per  Inventory,) 
Cash  on  hand, 
Notes      " 

W.  T.  Brooks,      Balance  of  % 

John  S.  Williams,      " 

Wm.  Dallas, 

Steamer  Troy,           "        " 

Robt.  S.  Hayward,    " 

Toola  and  Implements,  at  valuation. 

T.iahilit.ifis. 

"Wm.  Jones,        Net  Capital,  July  1,            $8637  35 
"                    i  Net  Gain,                               228  50 

Thos.  Mason,     Not  Capital,  July  1,               863fl  35 
"                     i  Net  Gain.                                228  50 

Geo.  F.  Smith,  Net  Capital,  July  1,              8637  35 
"                   \  Net  Gain,                             228  50 

55 

8865 
8865 
8865 

85 
85 
85 

26597 

55 

. 

^ 

95 


QUESTIONS    FOR"  EEVIEVV. 


QUESTIONS    FOR    REVIEW 


EEMAEKS,  Page  50. 

1.  What  is  the  peculiar  feature  of  Set  III  ?  2.  How  does  the  form  of  the  Cash 
Bopk  in  this  Set,  diSer  from  that  ia  the  preceding?  3.  Which  form  is  preferable? 
4.  Why  ?  5.  For  what  purpose  is  tho  Sales  Book  used  ?  6.  Ia  it  essential  that 
the  sales  should  be  entered  on  the  Day  Book?  7.  How  posted  if  not  so  entered  ? 
8.  What  do  the  initials  in  the  margin  of  the  Sales  Book  indicate?  9.  Is  the  Sales 
Book  used  in  making  up  a  list  of  Resources  and  Liab.hties  ? 

EEMAKKS,  Page  72. 

10.  What  is  the  purpose  of  Set  lY?  11.  Upon  what  grounds  has  Single 
Entry  been  condemned  ?  12.  Is  the  objection  valid  ?  13.  Is  Single  Entrj'  used  to 
any  extent  in  first-class  Business  Houses?  14.  What  is  the  important  feature  in 
this  set?  15.  How  does  the  Sales  Book  differ  in  its  use  from  that  in  Set  III? 
16.  What  is  the  advantage  ?  17.  What  do  the  initials  in  the  margin  indicate? 
18.  What  other  feature  than  the  pcciHiar  use  of  the  Sales  Book  is  prominent  in  this 
Set?  19.  How  must  a  change  in  the  business  be  marked  ?  20.  At  what  periods 
in  business  is  it  proper  that  the  resources  and  liabilities  should  be  shown?  21.  In 
admitting  a  new  partner  with  an  equal  investment,  how  can  the  proper  amount  of 
the  investment  be  a.scertained  ?  22.  What  objection  to  making  the  neu;  partner'* 
investment  equal  to  the  original  investment  of  the  oW? 


9G 


PART  11. 


DOUBLE     ENTRY. 


PART    II. 
DOXJBLJE     ENTRY. 


INTRODUCTION. 

If  the  method  of  keeping  accounts  by  Single  Entry  may  be  called 
a  system^  that  by  Double  Entry  may  very  properly  claim  the  dig- 
nity of  an  exact  science  •  *  for,  while  the  former  is  not  devoid  of 
excellence  as  a  means  of  showing  the  conjditioti  of  business,  the 
latter  not  only  affords  a  proof  of  its  own  correctness,  but  in  addi- 
tion to  showing  the  condition  of  business,  gives,  aLjt>,  -with  mathe- 
matical exactness,  an  indication  of  the  particular  channels  through 
which  gains  and  losses  accrue.  *The  essential  difference  in  the  two 
systems  has  reference,  mainly,  to  this  latter  qualification,  and  to  the 
fact  that  in  Double  Entry  all  the  results,  including  resources,  liabil- 
ities, gains  and  losses,  are  shown  in  the  Ledger,  while  in  Single 
Entry,  the  j^artial  results,  at  all  attainable,  are  gathered  from  various 
auxiliary  books,  including  the  Ledger,  Cash  Book,  Bill  Book,  etc. 

'  The  precise  difference  may  be  appreciated  by  comparing  Set  III. 
in  Part  11.  with  the  corresponding  Set  in  Part  I.,  the  transactions 
being  the  same  in  both  cases. 

*The  tei'ra  Double  Entry,  as  contradistinctive  to  Single  Entry, 
has  reference  to  the  fact,  that  for  every  transaction,  two  or  more 
entries  are  made  in  the  Ledger.  "  The  copdition  of  these  entries  is 
such  that  each  transaction,  when  properly  recorded,  will  produce 
on  the  Ledger  equal  debits  and  credits ;  tliat  is,  the  same  value 
which  is  carried  to  the  debtor  side  of  one  or  more  accounts  must 
also  be  carried  to  the  creditor  side  of  one  or  more  accounts,  ]>ro7 
ducing  thus  a  perpetual  equilibrium  of  debits  and  credits,  'and. 
affording  a  distinct  test  of  the  correctness  of  the  work. 

The  theory  of  "  equal  debits  and  credits"  is  the  leading  feature, 
of  Double  Entry  j  and  although  its  application  is,  in  all  cases,  most 

99 


INTRODUCTION. 

reasonable  and  satisfactory  to  the  accountant,  it  is  often  adjudged 
by  those  whose  general  intelligence  should  cause  them  to  blush  for 
their  ignorance  in  this  regard,  '  as  being  comj^lex  and  mysterious, 
and  calculated  more  to  befog  the  mind  of  the  uninitiated  than  to 
subserve  the  ends  of  justice. 

..  *  To  those  who  are  troubled  with  these  vagaries,  it  is  only  neces- 
sary to  say  that  Double  Entry  contains  every  feature  of  Single 
Entry ;  and,  that  so  flxr  as  Single  Entry  goes,  it  differs  in  noae  of 
its  results  from  Double  Entry ;  the  latter  being  a  continuation,  ov, 
rather,  a  perfection,  of  the  purposes  of  the  former.  *The  main  dis- 
tinction which  we  shall  recognize  between  the  two  systems  i;*,  that 
while  in  Single  Entry  a  record  is  kept  of  resources  and  liabilities 
only,  in  Double  Entry  a  similar  and  additional  record  is  kept  of 
special  gains  and  losses.  "This  grand  feature  of  Double  Entry 
should  commend  it  at  once  to  all  prudent  business  men ;  for  while 
it  may  properly  be  regarded  as  affording  a  true  indication  of  the 
comparative  merits  of  the  various  schemes  of  profit,  it  also,  in  a 
great  measure,  guards  against  errors  and  omissions  which  might 
pass  undetected  in  Single  Entry. 

As  in  Single,  so  in  Double  Entry,  the  main  book  of  Accounts  is 
"the  Ledger.  '^The  Single  Entry  Ledger,  however,  contains  only 
accounts  Avith  individuals,  while  the  Double  Entry  Ledger  shows 
the  result  of  each  transaction,  both  as  regards  the  character  of  the 
exchange  and  the  gain  or  loss  thereby  effected.  Thus  ''an  account 
is  kept,  not  only  with  2^6rsons  whom  we  may  owe,  or  who  may  owo 
us,  but  with  every  species  of  property  in  which  we  deal,  and  every 
cause  producing  gain  or  loss. 

"  Although  it  is  customary,  in  connection  with  Double,  as  well 
as  Single  Entry  books,  to  keep  a  Cash  Book  and  Bill  Book,  yet  all 
the  essential  facts  connected  with" cash  and  notes  are  shown  in  the 
proper  Ledger  accounts. 

'*  The  three  main  books  used  in  Double  Entry  are  the  Day  Book, 
Journal,  and  Ledger.  '*  The  Day  Book  and  Journal  are  sometimes 
combined  in  one. 

"The  Day  Book. 

Is  the  original  book  of  entry,  and  contains  a  consecutive  history  of 
the  transactions,  in  the  order  and  date  of  their  occurrence.  ''  It 
should  be  plain,  concise,  and  unequivocal  in  its  statements ;  neither 
confusing  the  mind  by  redundancy  of  language,  nor  leaving  room 
for  improper  inferences  from  lack  of  sufficient  explanation. 

100 


INTRODUCTION. 


"The  Journal, 

When  used  separately,  is  the  intermediate  book  between  the  Day 
Book  and  tlie  Ledger.  '^Its  office  is  to  decide  upon  the  proper 
debits  and  credits  involved  in  each  transaction,  preparatory  to  their 
entry  upon  the  Ledger.  The  process  of  thus  classifying  the  trans- 
actions is  called  ^^journalizing. 

'*The  Ledger, 

Is  the  book  of  results^ — the  final  book  of  entry.  ^  Here,  under 
appropriate  heads,  called  accounts,  are  arranged  all  the  facts  neces- 
sary for  a  full  and  satisfactory  statement  of  the  business;  including, 
not  only  an  exhibition  of  the  present  resources  and  liabilities,  but  a 
distinct  record  of  particular  gains  and  losses.  The  process  of  trans- 
ferring to  the  Ledger  is  called  ^^ posting. 

The  following  examples  of  these  separate  books,  showing  their 
characteristic  records  of  the  same  transaction,  will  clearly  indicate 
their  use : — 

1. — Day  Book. 

New  York,  January  1,  1861. 


v/ 


%/ 


Bought  of  James  Monroe,  on  account, 
500  bbl3.  Flpur. @  $10 

2       ■ 


Sold  Andrew  Jackson,  for  cash, 

lOObbla.  Flour ®  $10  50 


& 


6000 


1050 


2. — JoumaL 

New  York,  January  1,  1861.  cr.    Cr. 


Merchandise,  Dr. 


To  James  Mouroe . . , 
2  


Cash, 


Dr. 


ledger  Tilles,— Dr. 


To  Merchandise. 


Ledger  Titles.— Cr. 


101 


$5000 


1050 


$5000 


1050 


INTRODUCTION. 


Dr. 


3. — Ledger. 

Merchandise. 


Cr. 


1861 
Jan. 

1 

To  James  Monroe. . 

1 

i 

5000 

1861 
Jan. 

1 

By  Cash 

1 

i 

1050 

1 

i 

For  vihat  debited. 

1 

4 

i 

1 

1 

i 

For  what  erediUd. 

1 

4 

1 

1 

Dr. 


James  Monroe. 


2 

Cr. 


1861 
Jan. 


By  Merchandise . . . . 


5000 


Dr. 


Cash. 


3 

Cr. 


1861 
Jan. 


To  Merchandise . . . 


1050 


102 


THE   SCIENCE   OF  ACCOUNTS. 


Although  the  books  containing  a  consecutive  history  of  the  bns« 
iness  are  essential  for  that  purpose,  yet  "  the  science  of  Accounts 
pertains  exchisively  to  the  results  of  the  transactions  as  shown  in 
the  Ledger.  Particularly  is  this  true  in  Double  Entry,  Avhere  the 
Ledger  contains  all  the  results  necessary  for  a  complete  rendering 
of  the  condition  of  the  business,  at  any  time. 

^  Each  Ledger  Account  is,  properly,  a  statement  of  some  financial 
fact,  and  shows  one  of  the  four  following  results,  viz. :  a  resottrccy 
a  liability^  a  gain^  or  a  loss.  These  facts  or  results  are  ascertained 
"  by  taking  the  difference  between  the  sides  of  the  accounts,  thus : 


Dr. 


Cash. 


Cr. 


r<7»*  Rteeivei. 

Conk  Pit  id  out. 

__ 

1S61 
Jan. 

1 

To  Stock  (Investmt) 

5000 

1861 
Jan. 

1 

By  Merchandise.... 

2600 

u 

15 

<*  Merchandise 

1500 

" 

19 

.... 

1200 

it 

30 

H                  U 

$11500 

5000 

** 

30 

"    David  Brown... 
"   Expense 

500 
800 

tl300 

Total  Cash  Received, $11500 

"       "      Paid  out, 4500 

Balance  on  hand — ^^'^  Resource,      $7000 


I>R. 


Clttt  of  Mtri-haniii) 


Merchandise.  Cr. 

Proctedt  of  3ferch*tn'iU*, 


1861 
Jan. 


ToOash. 


"    David  Browo. 

|M00 


2500 
1200 
1500 


1861 
Jan. 


By  Cash. 


1500 
5000 


Total  Proceeds  of  Merchandise, $6500 

•«     Cost  "  " 5200 

Net  Proceeds— '•Gain, $1300 

103 


Dr. 


the  science  of  accounts. 
David  Brown. 


Cr. 


ITit  indfhte'JntM  It  «». 


O'lr  iitJtbltrtnttt  In  J'm 


1S61 

Jan. 


To  Cash. 


500 


1861 
Jan. 


By  Merchandise.. 


1500 


"We  owe  him, $1500 

He  owea  us, 500 

Balance  due  him — ** Liability, §1000 


Dr. 


Expense. 


Cr. 


1S61 
Jan. 


To  Cash. 


Total  Outlay  for  Expenses — '"  Loss, 


$300 


"We  will  suppose  the  accounts  given  to  comprise  all  in  the  Ledger, 
with  the  exception  of  the  Stock,  or  Proprietor's  accouuv,  «\hicu. 
should  represent  the  net  investment ;  and  that  the  net  investment, 
as  shown  by  the  first  entry  in  Cash  account,  is  $5000.  The  fol- 
lowing simple  statement  will  sufiiciently  enforce  the  leading  prin- 
ciples of  the  science. 


Resource— Cash  on  hand $7000 

Liability  — "We  owe  David  Brown 1000 

2fet  Resources,  or  Present  Worth 

Q-ain  — On  Merchandise $1300 

Loss  — On  Expensa 300 

Net  Gain   $1000 

Add  original  Investment 5000 

Gives  Present  Worth 


$C000 


$6000 


From  the  foregoing  illustrations  we  are  enabled  to  deduce  the 
following  general  facts : 

1.  An  Account  is  a  ^*  statement  of  facts  pertaining  to  some  per- 

104 


THE    SCIENCE    OF    ACCOUNTS. 

fion,  species  of  property  or  cause,  so  arranged  as  to  show  an  ini- 
j)ortaut  and  specific  result. 

2.  ^  Every  account  has  two  sides,  a  debtor  and  a  creditor  ;  each 
containing  the  resuhs  of  separate  transactions,  and  showing,  in  the 
difference  between  tlie  amounts,  a  general  result  or  fact  having  an 
important  bearing  upon  the  business. 

3.  "Accounts  may  be  divided  into  two  classes;  one  of  which  is 
used  to  designate  the  resources  and  liabilities^  and  the  other,  the 
gains  and  losses. 

4.  ^  The  net  gain  or  loss  in  business,  as  evinced  by  the  general 
result  of  all  the  accounts  showing  gains  or  losses,  is  confirmed  by  a 
corresponding  increase  or  diminution  of  wealth,  which  is  shown  in 
the  general  result  of  all  the  accounts  showing  resources  or  liabil- 
ities. 

DEBITS    AND    CREDITS. 

^*  One  of  the  great  difficulties  which  beset  the  teacher  of  Accounts, 
lies  in  the  proper  definition  and  enforcement  of  the  terms  "  Debit 
and  Credit."  So  thorouglily  is  this  fact  appreciated,  that  ambitions 
authors  have  been  induced  to  prepare  entire  treatises  on  the 
science,  claiming,  as  an  apology  for  their  appearance,  the  discovery 
of  some  "  infallible  rule"  for  journalizing,  which,  in  the  author's 
opinion,  would  entirely  revolutionize  the  labor  and  processes  of 
instruction,  and  open  up  to  all  future  generations  the  grand  high- 
way of  "  Book-keeping-made-easy."  The  anxious  student  is  assured 
that  the  whole  matter  turns  upon  the  simple  facts  of  oioing  and 
being  owed.  "  Thus,"  says  the  author,  "  every  debit  owes  you, 
and  you  owe  every  cy•e(?^Yy"  and  from  these  premises  is  deduced 
the  infallible  and  homogeneous  corollary,  "  Debit  what  owes  you, 
and  Credit  what  you  owe." 

Another  class  of  authors  rush  to  the  opposite  extreme,  basing 
the  whole  theory  of  debits  and  credits  upon  their  utter  lack  of 
theory,  announcing,  at  the  very  threshold,  that  "the  items  of 
which  debits  and  credits  are  composed  form  a  list  of  incongruous 
facts  having  no  object  in  common."  "  And  yet,  these  very  authors, 
widely  as  they  differ  in  the  methods  used  to  enforce  the  truths  of 
science,  would  not  diflTer  in  the  least  as  to  the  truths  themselves, 
Avhen  applied  to  the  purposes  of  obtaining  the  grand  result  of  any 
series  or  combination  of  transactions  involving  financial  interests. 

In  whatever  theory  ice  may  advance,  therefore,  we  have  no  desire 
to  underrate  the  honest  convictions  of  any  one  who  has  made  him- 
self master  of  the  subject,  or  to  substitute  our  reasoning  for  his. 

105 


THE     SCIENCE     OF     ACCOUNTS. 

The  question  as  to  the  hest  methods  of  presenting  a  truth  is  purely 
professional.  The  main  object  of  every  teacher  should  be  the 
attainment  of  truth,  by  whatever  method. 

We  believe  that  every  student  who  will  thoroughly  familiarize 
himself  with  the  seven  principles  which  follow,  Avill  have  no  diffi- 
culty in  deciding  upon  the  proper  debits  and  credits  involved  in  any 
business  record  which  he  may  be  called  uj)on  to  make  : 

PRINCIPLES. 
1. — TJie  Proprietor. 
'*  The  person  or  persons  investing  in  the  business  should  be  creel' 
ited^  under  some  title,  for  all  such  investments,  and  also  for  his  of 
their  share  of  the  gain  ;  on  the  other  hand,  he  or  they  should  be 
debited  for  all  liabilities  assumed  by  the  concern  for  him  or  them, 
for  all  sums  withdrawn  from  the  business  by  him  or  them,  and  for 
such  loss  as  he  or  they  are  entitled  to  share. 

2.— Cash. 
''  Cash  account  should  be  debited  for  all  cash  receipts,  and  cred- 
ited for  ^l  cash  disbursements. 

3. — Merchandise. 
*' Merchandise,  and  all  species  of  property,  bought  upon  specula- 
lation,  should  be  debited.,  under  some  appropriate  head,  for  the  cost 
of  the  property  represented,  and  credited  with  its  proceeds. 

4.^ — PiUs  Receivable. 
*'  Bills  Receivable  account  should  be  debited  with  other  people's 
notes,  acceptances,  and  other  written  obligations  when  they  become 
ours,  and  credited  when  they  are  paid,  or  otherwise  disposed  of. 

5. — Hills  Payable. 
*'  Bills  Payable  account  should  be  credited  with  our  notes,  accep- 
tances,  or  written  promises  to  pay,  when  they  are  issued,   and 
debited  when  they  are  paid  or  redeemed. 

6. — Persons. 
'-  **  Personal  accounts,  such  as  the  names  of  persons,  banks,  of 
other  institutions,  competent  to  sue  or  be  sued,  should  be  debited 
under  their  proper  titles  wlien  tliey  become  indebted  to  us,  or  we 
get  out  of  their  debt,  and  credited  when  we  become  indebted  to 
them,  or  they  get  out  of  our  debt. 

106 


THE    SCIENCE    OF    ACCOUNTS. 

7. — Expense,  Etc. 
"All  expenses,  of  whatever  name,  should  be  debited  for  the  out- 
lay, and  all  causes,  of  whatever  kind,  producing  us  value,  should 
be  credited  under  some  name,  for  the  amount  tlius  produced. 
The  foregoing  princij)le3  are  all  embraced  in  the  following  simple 

Formula 
"Debit  what  costs  the  concern  value;  and  Credit  what prof?Mce5 

the  concern  value. 

'  «♦• 

QUESTIONS    FOR    REVIEW. 

IKTKODUCTION,    PAGE    99 

1.  "Why  has  Double  Entry  better  claims  to  tho  distinction  of  an  exact  science 
than  Single  ICntry  ?  2.  In  wliat  particulars  do  the  two  systems  differ  ?  3.  IIow 
may  the  precise  difference  be  seen  ?  4.  To  what  has  tlie  term  Doubh  Entry  refer- 
ence ?  5.  What  is  tho  condition  of  every  complete  entry  upon  tho  Ledijer  ?  6. 
What  is  the  advantage  of  tho  equilibrium  produced  in  the  Lodger?  7.  lIow  is  tho 
theory  of  "equal  debits  and  credits"  sometimes  viewed?  8.  IIow  may  these  ob- 
jections bo  answered  ?  9.  What  is  the  main  distinction  recognised  in  this  treatise? 
10.  Wiiy  should  tliis  feature  of  Double  Entry  commend  it  to  business  men?  11. 
What  is  the  main  book  of  accounts  in  Double  Entry?  12.  IIow  does  the  Double 
Entry  Ledger  differ  from  tho  Single?  13.  What  besido  personal  accounts  aro  kept 
in  the  Double  Entry  Ledger?  11.  Do  tho  Cash  Book  and  Bill  Book  alone  contain 
all  the  facts  pertaining  to  not^s  and  cash  ?  15.  What  aro  the  tiiree  main  books  in 
Double  Entry?  16.  Which  two  of  tliese  aro  sometimes  combined  in  one?  17. 
What  does  tho  Day  Book  contain  ?  18.  What  should  be  its  character  ?  19.  What 
relation  docs  Uio  Journal  sustain  to  tho  other  books?  20.  What  is  its  office?  21. 
What  is  tho  process  of  entering  in  tho  Journal  called?  22.  Describe  tho  Ledger. 
23.  What  does  tho  Ledger  contain  ?  21.  What  is  tho  process  of  entering  in  tho 
Ledger  called  ? 

THE    SCIENCE    OF    ACCOUNTS,    PAGE    108. 

25.  To  what  does  tho  "  Science  of  Accounts"  exclusively  pertain  ?  20.  Of  what 
is  each  Ledger  account  a  statement?  27.  IIow  aro  these  results  shown?  28. 
When  the  Debit  side  of  Cash  account  Ls  t!io  larger,  what  does  tho  difference  express? 
29.  When  tho  Credit  side  of  Merchandise  account  i.^  the  larger,  what  does  the  dif- 
ference express  ?  30.  When  tiio  Credit  sido  of  a  personal  account  is  tho  larger, 
what  does  the  difference  express?  31.  When  tiie  Debit  side  of  Expense  account 
is  the  larger,  what  docs  tho  difference  express?  32.  What  is  an  Account ?  33. 
Wliat  are  the  characteristics  of  an  Account  ?  34.  Into  how  many  classes  may 
Accounts  bo  divided,  and  what  aro  they  ?  35.  How  is  tho  net  gain  or  loss  in  busi- 
nos.s,  as  shown  by  tiie  special  accounts,  conOrmed?  36.  What  is  one  of  tho  chief 
difficulties  in  tho  way  of  teaching  accounts  ?  37.  Dj  intelligent  autiiora  and  teach- 
ers differ  in  their  application  of  the  tniths  of  Double  Entry  ?  38.  When  should  tho 
proprietor  of  the  business  be  debited,  and  when  credited  t  39.  Wlien  should  Cash 
account  be  debited,  and  when  credited?  40.  Merchandise?  41.  Bills  Receivable? 
42.  Bills  Payable?  43.  Personal  Accounts.  44.  Expanse,  etc.  43.  Repeat  tho 
gQaeral  formula  fyr  debits  &ad  credits. 

107 


ACCOUNTS    CURRENT. 


An  Account  Current  in  commercial  usage,  is  the  statement  in 
proper  form  of  a  current  or  running  account.  It  is  usually  made 
with  a  view  to  settlement  and  shows  the  balance  due  to  or  from 
the  party  to  whom  it  is  rendered.  When  large  transactions  are 
conducted  on  credit  it  is  usual  in  rendering  the  Account  Current 
to  average  the  time  of  payment,  so  that  the  balance  may  be  paid 
without  either  pirty  losing  interest.  The  various  methods  of 
averaging  are  given  in  most  arithmetical  works,  and  thoroughly 
enforced  in  the  High-school  edition  of  this  series.  We  give  below 
the  most  common  form  of  an  Account  Current. 


Mk.  Johx  R.  Penn, 


In  Account  Current  with  S.  S.  Packard. 


1861. 

— ■ 

July 

1 

To  2  doz.  Brvant  &  Stratton's  (H.S.)  Book-k' 
"  1    "        ■"             "           (Primary)    " 

ping 

30 
7 

11 

12 

"  6  "Webster's  Unabridged  Dictionary, 

@  $6 

36 

15 

"  4  Reams  Union  Letter  Paper 

®  $3 

12 

Aug. 

10 

"  1  doz.  Gross  Gillott's  604  Pens 

®  75^ 

9 

" 

"  20  doz.  Spencerian  Copy  Books 

@$1 

20 

11 

15 

"15  Dean's  Commercial  Law 

®  $2 

30 

II 

20 

"  20  Gross  Spencerian  Pens 

@  1H 

15 

11 

1) 

"12  Reams  Best  "Wove  Cap  Paper 

@$4 

48 

)i 

30 

"  50  Commercial  Arithmetic 

@  75? 

37 

50 

11 

" 

"  6  Robinson's  Surveying 

$1  25 

7 

50 

"  12  Well's  Science  of  Common  Things 

@  50? 

6 

>i 

"  24     "      Natural  Philosophy 

@75^ 

18 

"  24     "       Chemistry 

Cb.      .  . 

®  75* 

18 

294 

July 

10 

By  Cash 

~ 

10 

Ifi 

11      11 

145 

Aug. 

1 

)i      » 

50 

205 

Balance  doe 

= 

89 

= 

108 


SET  I. 

(INITIATORY.) 
BAY  BOOK,  JOURNAL  AND  LEDGER. 

•WITH  EXPLANATIONS  FOE  JOtJBNALIZING,   STATEMENTS,   ETC. 


^vi%vw.e%%  '9Yo%>gtevo\i*. 


REMARKS. 


The  following  set  comprises  the  most  simple  transactions  known 
in  business ;  the  main  purpose  being  to  illustrate  the  foregoing  prin- 
ciples, and  to  initiate  the  student  more  fully  into  the  processes  of 
Book-keeping.  The  transactions  are  first  recorded  historically  in 
the  Day  Book,  in  the  order  of  their  occurrence ;  from  thence  trans- 
ferred to  the  Journal,  and  from  thence  to  the  Ledger.  In  journaliz- 
ing a  transaction,  the  first  thing  to  be  considered  is,  the  person  or 
thing  affected  ;  next,  in  what  manner  affected  ;  and  next,  the  proper 
application  of  the  principle.  For  instance,  the  first  entry  is — "Bo't 
of  Smith  &  Sons,  on  %,  1000  Bbls.  Flour."  The  things  affected 
are.  Smith  &  Sons,  and  Flour.  We  have  become  indebted  to  the 
fonner,  and  the  latter  has  cost  us  value  by  involving  this  indebted- 
ness. "We  turn  to  the  pri?iciples^  and  learn  that  personal  accounts 
should  be  credited  Avhen  we  become  indebted  to  the  persons  (Prin.-6), 
and  merchandise,  and  all  species  of  property,  should  be  debited 
nnder  some  appropriate  head  for  its  cost  (Prin.  3).  The  established 
fonn  of  Jounial  entries  requires  the  debit  expression  to  precede  the 
credit,  and  hence  we  have  the  Journal  entry — "  Flour,  Dr.,  To  Smith 
&  Sons."  In  posting  this  entry  to  the  Ledger,  we  open  separate 
accounts  with  Flour,  and  Smith  &  Sons,  debiting  the*  former  and 
crediting  tlie  latter.  It  is  not  really  necessary  that  any  expression 
should  be  made  under  the  Ledger  title,  the  date  and  amount  being 
sufiiciont  to  show  the  result,  but  it  is  usual  to  insert  the  o]yj)osite 
Journal  expression,  as  an  indication  of  the  transaction.  The  check- 
mark {V)  in  the  Day  Book  is  made  immediately  after  the  transac- 
tion is  carried  to  the  Journal,  and  the  post-mark  in  the  margin  of 
the  Journal  (indicating  the  Ledger  page  to  which  the  account  is 
posted),  immediately  upon  its  being  posted.  The  numeral  in  tlie 
Ledger  column  next  preceding  the  amounts  indicates  the  Journal 
page  from  which  the  amount  is  transferred.  The  Ledger  is  left  in 
its  current  or  running  condition,  the  general  results  being  first 
indicated  hy  pencil  ^figures  on  the  smaller  side  of  each  account,  and 
next,  more  completely  and  systematically  in  the  Statement  en  page 
121.  The  method  of  showing  these  results  on  the  Ledger  is  fully 
shown  in  Set  II. 

It  is  expected  that  the  student  will  omit  no  part  of  the  exercises 
given,  nor  allow  himself  to  proceed  to  a  new  set  before  fully  under- 
standing the  former. 

110 


DAY  BOOK -SET  I, 

New  York,  January   1,  1861. 


Bought  of  Smith  &  Sons,  on  %, 

1000  Bbls.  Flour,  @  $6  00 

£     


Sold  Robert  Bates,  for  Cash, 

300  Bbls.  Flour,  @  $6  50 

S     


Sold  Peter  Cooper,  on  %, 

250  Bbls.  Flour,  @  $7  00 

/    


Sold  John  Jones,  on  his  Note  @  30  ds., 
150  Bbls.  Flour,  ®  $7  00 

y<^    


Bought  of  J.  R.  Wheeler,  on  our  Note  @  60  ds., 
500  Bush.  Wheat,         @  $1  00 

y£   


Sold  James  Turner,  fbr  Cash, 

100  Bush.  Wheat,  &  $1  25     $125  00 

100  Bbls.  Flour,  "    6  75       675  00 


y-^ 


Paid  Cash  for  Stationery  and  Books  for  use  of 
Store, 

y^  


Bought  of  Thomas  Payne,  for  Cash, 
300  Bbls.  Flour,  @  $5  00 

</    


Sold  Patrick  Murphy,  for  Cash, 

100  Bbls.  Flour,  @  $6  00 


111 


6000 


1950 


1750 


1050 


500 


800 


50 


1500 


600 
14200 


DAY  BOOK -SET  I. 

New  York,  January  18,  1861. 


V 


Bought  of  George  Davis,  on  %, 
1000  Bush.  Oats, 


Amount  ForvMrd, 


75* 


Sold  Raymond  &  Co.,  on  their  Note  ®  5  ds., 

500  Bush.  Oats,  @        80^    $400  00 

100      "      Wheat,  "  $1  15        115  00 


££ 


Sold  Abram  Fuller,  for  Cash, 

400  Bbls.  Flour,  @  $6  00    $2400  00 

300  Bush.  Wheat,  "  $1  10        330  00 


^d- 


Bought  of  James  Hathaway,  on  %, 

1500  Bbls.  Flour,  @  $5  50 

^/    


Sold  Jonas  Clark,  on  %, 
1000  Bbls.  Flour, 

£<? 


®  $6  00 


Received  Cash  in  full  for  Raymond  &  Co's  Note, 
^    _ 


Sold  John  Drummond,  for  Cash, 

500  Bbls.  P'lour.  @  $5  75  $2875  00 

500  Bush.  Oats,  "  •      90*      450  00 


SiP 


Paid  Clerk  Hire,  in  Cash, 
"     Store  Rent, 


$50  00 
50  00 


14200 
750 


515 


2730 


8250 


6000 


515 


3325 


100 


36385 


112 


JOURNAL -SET  I. 

New  York,  January  1,  1861.  Dr. 


Cr. 


Flour,  Dr. 

To  Smith  &  Sons, 

Flour  cost  $6000,  and  is  debited  accord- 
ing to  Principle  3.  We  have  become  indebted 
to  Smith  &  Sons,  and  they  are  credited  ac- 
cording to  Principle  6. 


Cash, 


Dr. 

To  Flour, 


Cash  is  received,  and  is  debited,  according 
to  Prin.  2.  Flour  has  produced  casli,  and  is 
credited  with  the  amount  produced,  accord- 
ing to  Prin.  3. 


d' 


Peter  Cooper, 


Dr. 
To  Flour, 


Peter  Cooper  has  become  indebted  to  us, 
and  is  debited  according  to  Prin.  6.  Flour 
has  produced  this  indebtedness,  and  is  cred- 
ited, according  to  Prin.  3. 


7 


Bills  Receivable,  Dr. 

To  Flour, 

Bills  Receivable  is  debited,  according  to 
Prin..  4.  Flour  is  credited,  according  to 
Prin.  3. 


113 


6000 


1950 


1750 


1050 


10750 


6000 


1950 


1750 


1050 


10750 


JOURISTAL-SET  I. 
New  York,  January  10,  1861.         Dr. 


Or 


/ 


Amounts  Forward, 

Wheat,  Dr. 

To  Bills  Payable, 
Wheat,  Dr.,  Prin.  3.  BiUaPayle,  Cr.,  Prin.  5. 

-/£ 


Cash,  Dr. 

To  Wheat, 
"    Floue, 

Cash,  Dr.,  Prin.  2.  Whcatfc  Fl'r,  Cr.,  Prin.  3. 

y^ 


Expense,  Dr. 

To  Cash, 
Expense,  Dr.,  Prin.  *l.     Cash,  Cr.,  Prin.  2. 

.ys : 


Flour,  Dr. 

To  Cash, 
Flour,  Dr.,  Prin.  3.     Cash,  Cr,  Prin.  2. 

<r 


Cash,  Dr. 

To  Floue, 
Cash,  Dr.,  Prin.  2.     Flour,  Cr^  Prin.  3. 

y,^  . . . 


Oats,  Dr. 

To  George  Davis, 
Oats,  Dr.,  Prin.  3.  Geo.  Davis,  Cr.,  Prin.  6. 

114 


10750 
500 


800 


50 


1500 


600 


750 


14950 


10750 
500 


125 
675 


50 


1500 


GOO 


rso 


14950 


JOURNAL -SET  I. 

New  York,  January  20,  1861.         Dr 


Cr. 


Amounts  Forward, 

Bills  Receivable,  Dr. 

To  Oats, 
"    Wheat, 

Bills  Receivable,  Dr.,  Prin.  4.     Oats  and 
"Wheat,  Cr.,  Frin.  3. 

£^ 


Cash,  'Dr. 

To  Flour, 
"    Wheat, 

Cash,  Dr.,  Prin.  2.    Flour  and  Wheat,  Cr., 
IVin.  3. 

£^ 


Flour,  Dr. 

To  James  Hathaway, 

Flour,  Dr.,  Piin.  3.     J.  Hathaway,  Cr., 
Prin.  6. 

^/ 


Jonas  Clark,       Dr. 

To  Flour, 

Jonas  Clark,  Dr.,  Prin.  6.     Flour,  Cr., 
Piin.  3. 

£^ 


Cash,  Dr. 

To  Bills  Receivable, 

Cash,  Dr.,  Prin.  2.    Bills  Receivable,  Cr., 
Prin.  4. 

.£^ 


Cash,  Dr. 

To  Flour, 
»    Oats, 
Cash,  Dr.,  Prin.  2.     Flour  and  Oats,  Cr., 
Prin.  3. 

J^ 


Expense, 


Dr. 

To  Cash, 
Expense,  Dr.,  iVin.  7.     Cash,  Cr,,  Prin.  2. 

— - 


14950 
515 


2730 


8250 


6000 


515 


3325 


100 


36385 


14950 

400 
115 


2400 
330 


8250 


6000 


515 


2875 
450 


100 


36385 


Dr. 


LEDGER -SET  I. 
Flo-ar. 


Cr. 


1861 

1S61 

— 

Jan. 

1 

To  Smith*  Sons 

1 

6000 

Jan. 

2 

By  Cash, 

1 

1950 

II 

15 

"  Cash, 

2 

1500 

5 

"  P.Cooper, 

1 

1750 

II 

25 

"  J.  Hathaway 

3 

8250 

7 

"  Bills  Rec'ble 

1 

1050 

15750 

12 
17 

"  Cash, 

It      11 

2 

II 

675 
600 

Proceeds, .  .  tlrOO 
Cast,    ....     15150 

Net  Proceedt,    $1550 

II 

22 
27 
29 

II      II 

"  Jonas  Clark, 
"   Cash, 

3 
3 
3 

2400 
6000 
2875 

_ 

ITroo 

Dr,     Our%ag«in,tllum.       Slllitll      Sd      SoilS.       Tk«r  %  againrt  u..     Cv. 


Wt  om  them  $6000 


1861 
Jan. 


By  Flour, 


6000 


Dr. 


Cash. 


Cr 


1861 

1861 

— 

Jan. 

2 

To  Flour, 

1 

1950 

Jan. 

14 

By  Expense, 

2 

50 

12 

"  Wheat  &Frr 

2 

800 

II 

15 

"  Flour, 

2 

1500 

17 

"  Flour, 

2 

600 

11 

3 

"  Expense, 

3 

100 

22 

"  Fiour&Wh't 

3 

2730 

1C60 

28 

"  Bills  Rec'ble, 

3 

515 

29 

"  Flour, 

n 

3325 

Received.  $9920 
Paid  oat,'     1650 

WW 

On  hand,  $8«0 

Dr.      Our  fj^  affain,t  him.     DPetOP        CoOpGI*.        ni.  %  again,!  v,.        Cl* 


1S61 
Jan. 


To  Flour&Oats, 


1750 


Ht  owM  tu  $!'50 


116 


LEDG-ER-SET  I. 

JJV.     Otkert'fuUtTttHvtd.      !BlllS      IvGC    t>le,       OlHur,' noUt  dUpoiui  of.     UT. 


1861 

Jan. 


To  Flour, 
"  Oata&Wh't 


1050 
515 


1S61 
Jaa. 


28 


By  Cash, 


Jfotes  rec*Wed,  $1565 

"      dwp'd  of, B15 

"      on  lund,  |1060 


515 


Dr. 

Cott. 

"Wlieat 

• 

Proeeedt, 

Cr 

• 

1861 

1S61 

Jan. 

10 

ToBUlsPayable 

Proraedi, .  ,    $S70 
Cost,    ....       600 

Jfet  Proceed),     «10 

3 

500 

Jan. 

12 
20 
22 

By  Cash, 
"  Bills  Rec'ble 
"  Cash, 

610 

2 
3 
3 

125 
115 
330 

X/7*.        Our  Mie)  redeemed.         JtjillS      X     SiySilyiG.         OurmUtutued.,      L/V. 


y<4e»  mUetand'j,  9500 


1S61 
Jan. 


10 


By  Wheat, 


500 


Dr. 

Outlay  for  Erpmeee 

"Rxpense. 

Cr 

• 

1S61 
Jan. 

14 
30 

To  Cash, 

2 
3 

50 
100 

ChUloffvr  Eapen.  $150 

IM 

117 


8 


Dr. 


LEDGER -SET  I. 
Oats. 


Cr. 


1861 
Jan. 


18 


To  Geo.  Davis, 


Proceeds, .  .     ^0 
Cost,    ....       780 

Ntl  Prxteda,   |100 


T50 


1861 

Jan. 


By  Bills  Rec'blo 
"  Casli, 


400 
450 


Dr.      Our%agaimt\im.       GrCOrge      DavlS.        H:.%aga!n.tu,.      Cr. 


Wt  owt  him  97S0 


1861 

Jan. 


18   By  Oats, 


750 


Dr.   cHr%again,thim.    J.   Hatlia"way.    ir„%, 


Cf. 


Wt  OKt  kirn  (8250 


1861 
Jan.    25 


By  Flour, 


8250 


Dr.        Our^again^khn.        JoiiaS        Clapk.         Hi.  %  againtt  u,.         Cr 


1861 
Jan. 


27 


To  Flour, 


6000 


Zr<  tncet  u<  (6000 


118 


GENERAL    STATEMENT. 


"Wk  are  enabled  now  to  exhibit  the  current  condition  of  our 
businens  during  the  month,  with  the  results  thus  far  accomplished. 
The  Ledger  accounts  present  the  following  facts : — 


Dr. 

Trial  Balance,— Pace  of  Ledger. 

Cr. 

15750 

Cost Flour, Proceeds 

Our  %ag'st  them.  SmITH  &j  SoJS'S,  Theirfc  ag'nstus. 

17300 
6000 

9920 

Received. CaSH, Paid  out. 

1650 

1750 

'  Ilia  %  agaimtus.  PeTER  CoOPER,  Onr%  ag''nsthim. 

1565 

Others' notes  rec-d.  BiLLS  Rec'bLE,  Othernotes  disp.o/ 

515 

500 

1  Cost Wheat, Proceeds. 

Ournotearedem'd  BiLLS  Pat'bLE,  Ournotes issued. 

570 
600 

150 

Outlay. Expense, 

750 

Cost. Oats, Proceeds. 

Our%  off'nsthim.  GeORGE  DaVIS,  JTU  %  against  us. 
Our%  ag'nsthim.  J.  HaTUAWAY,   JTis  %  against  us. 

850 

750 

8250 

6000 

Our%  ag-nsthim.  JoNAS  ClARK,    EU  %  against  us. 

Equilibrium^ 

86385 

36385 

The  above  statement  is  called  a  "  Trial  Balance  "  for  the  reason 
most  apparent ;  it  is  a  trial  to  ascertain  if  the  debits  and  credits  on 
the  Ledger  are  equal,  or  balance.  It  does  not,  as  some  suppose, 
prove  the  Ledger  to  be  absolutely  correct,  as  there  are  many  cir- 
cumstances under  which  the  Ledger  may  balance,  and  yet  be  wrong. 
This  form  of  Trial  Balance,  however,  is  so  nearly  a  test,  that  under 
ordinary  circumstances,  it  may  be  considered  satisfactory.  By 
observing  the  footings  it  will  be  seen  that  they  exactly  agree  with 
those  of  the  Journal,  which  could  rarely  be  the  case,  were  any  of 
the  Journal  entries  omitted  in  posting ;  and  as  the  footings  of  the 
Journal  columns  also  tally  with  that  of  the  Day  Book,  it  is  almost 

119 


GENERAL    STATEMENT. 

conclusive  that  all  the  original  entries  have  found  their  way  into  the 
Ledger.  There  will  remain  but  two  chances  of  error  in  the 
accounts,  viz :  from  imj^roper  Jounial  entries,  or  from  posting  to 
the  wrong  accounts  in  the  Ledger. 

In  order  to  aftbrd  this  additional  test,  we  have  found  it  necessary 
to  carry  into  the  Trial  Balance  the  total  footings  of  the  Ledger. 
If  we  desired  only  to  test  the  balances  of  the  Ledger,  this  would  not 
be  necessary,  as  will  be  seen  from  the  following  example  : 


Trial  Balance, —  Differences. 


Dr 


Cr. 


1  FlOUB, 2ret Proceeds,   .  .  Gain,.. . 

2  Smith  &  Sons,   Weowetium,. . .  uataity, 

3  Cash, Amount  on  hand,  Resource, 

4  Peter  COOPEB,   i7«  OWe«  ?«,....  Reaonree, 

5  Bills  Rec'bLE,  Amount  on  haTul,  Re«oa«e, 

6  Wheat, ^et  Proceeds,    .  .  Gain,  .  . 

7  Bills  Payable,  Our  nou«  out^rg,  uabiuty, 

8  Expense,  ....  Oiuiay, lom,  . . 

9  Oats, -*"«<  Proceeds, .  .  .  Gain,  .  . 

10  George  Davis,  weoweMm,  . . .  uauuty, 

11  J.  Hathaway,   Weowehim,  . . .  uabuity, 

1 2  JoxAS  Clark,  ne  owes  tu. . , . .  Re«ourc«, 

Equilibrium^  .     .     .     . 


8270 
1750 
1050 


150 


6000 


17220 


1550 
6000 


70 
500 

100 
,  750 
8250 


17220 


We  have  here  a  test  of  equal  debits  and  credits  quite  as  satisfac 
tory  as  the  other,  and  much  more  brief,  upon  the  principle  of  can- 
cellation ;  that  is,  permitting  a  debt  to  offset  a  credit  of  the  same 
amount,  and  vice  versa.  These  forms  have  each  its  peculiar  advan- 
tages, and  it  is  often  found  convenient  to  combine  them  in  one. 
Examples  of  this  latter  method  will  be  found  in  a  more  advanced 
portion  of  the  book. 

In  the  Trial  Balance  of  "  Differences  "  it  will  be  seen  that  each 
Ledger  account  expresses  one  of  the  fo'or  results  previously  men^ 

120 


GENERAL    STATEMENT. 

tioned,  viz :  a  resource^  a  Uahility^  a  gain,,  or  a  loss.  By  a  careful 
chissification  of  these  facts  we  are  enabled  to  present  one  of  the 
most  beautiful  and  satisfactory  theories  of  Double  Entry,  viz :  tliat 
the  net  gain  or  loss  in  business  exactly  corresponds  with  the 
increase  or  diminution  of  wealth.  The  following  statements  should 
be  carefully  studied : 


Resources    and    Liabilities. 


Resources 

3  Cash, Ammmtonliana,.  .  .     $8270  00 

4  Peter    Cooper,     jre&weftim, 1750  00 

5  Bills  Rec'able,     H'otesonJumd,  . . . .      1050  00 
12     Jonas  Clark,  .  .     Ueowesw, 6000  00 

Liabilities 

2     Smith  &  Sons,  .     we  Mce  them, 6000  00 

7     Bills  Payable,     Our  votes  outstarnTg,        500  00 

10  George   Davis,     WemceUm, 750  00 

11  J.  Hathaway,  .      «    «    "    8250  00 

Present  Worth,    .     .     . 


17070 


15500 


1570 


Gains   and  Losses. 


1  Flour,  , 
6  Wheat,  . 
9     Oats,  .     . 


-Gains. 


Net  Proceeds,, 


-Losses.. 


8     Expense,     .     Outlay,, 


1550  00 

70  00 

100  00 


Net  Gai.v,     .     .     . 


121 


1720 


150 
1570 


EXAMPLES    FOR    PRACTICE. 

By  comparing  the  numerals  in  these  statements  with  those  in  the 
Trial  Balance,  it  will  be  seen  that  all  the  Ledger  accounts  are  used, 
and  that  the  original  purpose  of  each  account  is  fully  recognized. 
The  statement  of  Gains  and  Losses  will  afford  a  more  practical  idea 
of  the  peculiar  advantages  of  Double  Entry  than  could  be  gathered 
from  any  other  system  of  logic.  Tlie  bare  assertion  that  all  gains 
are  the  result  of  an  increase.,  and  all  losses  of  a  decrease  in  Avealth 
could  not  be  denied ;  but  the  proof  of  the  assertion,  drawn  from  the 
Ledger  itself,  as  indicated  in  the  above  statements,  will  carry  con- 
viction which  must  be  conclusive  and  abiding. 

Commencing  business  without  capital,  it  will  be  easily  under- 
stood that  the  presefd  worth.,  or  net  capital  at  any  time,  must 
exactly  correspond  with  the  net  gain. 

From  these  illustrations  we  derive  the  following 

RULES. 

1.  To  find  the  Net  Gain:  Subtract  the  su>t  of  all  the  losses 

FROM   THE  SUM  OF  ALL  THB  GAINS  ;    Or,  SUBTRACT  THE    CAPITAL 
AT    COMMENCING   FROM   THE    CAPITAL   AT    CLOSING. 

2.  To  find  the  Present  Worth  :  Subtract  the  liabilities  from  the 

RESOURCES  J  or,  Add  the  net  gain  TO  the  net  intestment 


EXAMPLES    FOE    PRACTICE. 


Example  L — A.  commenced  business  with  the  following  invest- 
ment :  Cash  in  hand,  $300  ;  Cash  in  bank,  $4000  ;  Mdse.  on  hand, 
8-5000 ;  Notes,  $2500.  His  losses  and  gains  were  as  follows  :  Gjuu 
on  mdse.,  $1575;  Do.  on  Shipment  speculations,  $5000.  Loss  on 
expense,  $300  ;  Do.  on  bad  debts,  $1200.  What  was  his  net  gain? 
Wfiat  his  capital  at  the  close  of  business  f 

Ans.—^Qt  gain,  $5075.     Cap.  at  closing,  $1G,875. 

Example  II. — B.  commenced  business  with  a  cash  capital  of 
$3795  83.  At  the  end  of  the  year  his  resources  and  liabilities  wer^ 
as  follows :      i2e«ot^rce«,^Mdse.   unsold,  $5725 ;    Cash   on   hand, 

122 


EXAMPLES    FOR    PRACTICE. 


$3875  90  ;  Notes,  $1500  ;  Personal  accounts,  $8500.  Liabilities — 
Bills  Payable,  $8000;  Personal  accounts,  $3500.  What  is  fie  worth 
at  the  end  of  the  year  f    JIow  much  did  he  gain  ? 

Ans. — Present  worth,  $8100  90.     Gain,  $4305  OY. 

Example  IIT. — C.  commenced  business  without  a  capital.    At 
the  end  of  the  year  his  Ledger  exhibited  the  following  balances . 


Dr, 


Cr. 


Cash,.     .     .     . 
Mdse.,     .     .     . 
John  Johnson, 
Robert  Blake,  . 
Silas  Burch, 
Andrew  Smiley, 
Bills  Receivable, 
Bills  Payable,  . 
Expense,      .     . 


4500 

1500 
1200 


1900 
175 


9275 


1575 


1875 
4725 

1100 


9275 


What  has  been  his  gain  ?    What  is  his  cajntal  at  the  close  of  the 


year 


9* 


Example  IY. — The  following  Trial  Balance  shows  the  condition 
of  my  business  at  the  close  of  a  year.  Required  a  statement  show- 
ing gains  and  losses,  resources  and  liabilities. 


Dr. 


Cr. 


Cash, 

Merchandise,    .     . 
Real  Estate,     .     . 
Andrew  Simpson, 
William  Matthews, 
Expense,      .     .     . 
Bills  Receivable,  . 
Bills  Payable,  .     . 
Henry  Martin, 
Abi'ara  Guilford,  . 


10397 
I  6000 
I  10000 
4000 
,  8000 
i  1200 
i    7000 


500 
1500 


47597 


6792 
5620 
12000 
2500 
9750 

5000 
1500 
3434 
1000 


47597 


84 


10 
00 


*  This  and  the  saccc«dlng  example  sbotiUI  be  randcrecl  in  tiio  form  of  the  Statement  on  page  121. 

123 


EXERCISES   FOR   THE   LEARNER. 


JET"  I  K  S  T       SEKIES. 


Memoranda. 

January  1.  Commenced  business  without  capital.  Bo't  of  S.  S. 
Packard  on  %,  Mdse.  amounting  to  $5750. — Sold  John  R.  Penn,  for 
Cash,  10  Yds.  Broadcloth,  @  $5  ;  3  do.  Vest  Satin,  @  $8. — Paid 
Cash  for  Stationery  and  Postage,  $10. — 2.  Sold  J.  H.  Goldsmith, 
on  %,  1  Vest  Pattern,  $7  50 ;  Trimmings  for  same,  $2 ;  50  Yds. 
Amoskeag  Sheeting,  @  12'?. — 3.  Sold  J.  M.  Bradstreet,  on  his  Note 
®  60  ds.,  1  Case  Boots,  24  Pairs,  ®  $3  50  ;  25  Yd«.  Flannel,  @  50^. — 
Sold  E.  A.  Charlton,  for  Cash,  1  Box  Hosiery,  $10 ;  75  Yds,  LoavcII 
Prints,  ®  lOf.— 5.  Paid  S.  S.  Packard,  Cash  on  %,  $50.-7.  Sold 
Robert  Baker,  Invoice  of  Shirting  and  Fancy  Cloths,  for  $3700; 
Received  in  payment.  Cash,  $3000  ;  Balance  charged  on  %. — 9.  Paid 
Store  Rent  in  Cash,  $100. — Received  Cash  in  full  of  J.  H.  Gold- 
smith's %,  $ .—10.  Sold  James  A.  Packard,  on  %,  20   Yds. 

Broad,  loth,  @  $3  75  ;  50  do  Cassimeres,  @  $1. — 12.  Sold  C.  J.- 
Dietrich, for  Cash,  1 2  Pairs  Ladies'  Congress  Gaiters,  @  $2  ;  1  Case 
Misses'  Tipped  Shoes,  24  Pairs,  ®  $1  25  ;  3  Cases  Men's  Double 
Sole  Boots,  36  Pairs,  ®  $4.-14.  Paid  Clerk's  Salary  in  Cash,  $50.— 
Sold  J.  C.  Bailey,  for  Cash,  1  Doz.  Balmoral  Skirts,  1 2  @  $2  ;  1  Piece 
Mous.  de  Laine,  75  Yds.,  ©20^;  1  do.  Wamsutta  Sheeting,  50  Yds. 
®  10^. — 15.  Bo't  of  James  Dawes,  on  our  Note  ®  3  mos.,  Invoice 
of  F.ancy  Broadcloth,  amounting  to  $2500. — Sold  Rob't  C.  Spencer, 
for  Cash,  2  Pieces  Broadcloth,  50  Yds.,  @  $3  50;  1  do.  Lowell 
Prints,  25  Yds.,  @  12^.^-16.  Paid  S.  S.  P:.ckard,  Cash  on  %, 
$2000. — Sold  Henry  Ivison,  on  %,  150  Yds.  Wamsutta  Sheeting, 
@  15f  ;  50  Yds.  Broadcloth,  @  $4.-18.  Received  Cash  of  James  A. 

Packard,  in  full  of  %, . — Sold  Richmond  Kingman,  for  Cash, 

3  Doz.  Elastic  IToop  Skirts,  36  @  $2  ;  4  Doz.  Balmoral  do,,  48  @ 
$2  25. — 20.  Sold  Henry  Blakeman,  for  Cash,  1  Piece  Irish  Linen, 

124 


EXERCISES    FOE    THE    LEARNER. 

50  Yds.  ®  75^;  3  do.  Lowell  Prints,  150  Yds.,  ®  10^7  5  do.  Amos- 
keag  Sheeting,  250  Yds.,  ®  li''. — 21.  Sold  J.  C.  Bryant,  on  %,  2 
Cases  Ladies'  Tipped  Gaiters,  48  Pairs,  ®  $2 ;  5  do.  Boys'  Double- 
sole  Boots,  60  Pairs,  ®  $1  50.— 22.  Paid  Cash  for  Petty  Expenses, 
$15  50.— 25.  Rec'd  Cash  on  Robert  Baker's  %,  $350.— Paid  S.  S. 
Packard,  Cash  on  %,  $500. — Sold  Lorenzo  Fairbanks,  on  %,  50  Yds. 
Broadcloth,  ®  $4 ;  75  do.  Cassimeres,  @  $1  25. — 27.  Sold  James 
Smith,  for  Cash,  3  Pieces  Cambric  Muslin,  60  Yds.,  ®  25f ;  3  do. 
Scotch  Plaid,  120  Yds.  ®  1  If. —Sold  J.  McMillan,  on  his  Note  ®  30 
ds.,  40  Yds.  Black  Doeskin,  ®  $1  25 ;  8  Pieces  ]V|errimack  Prints, 
250  Yds.,  @  IQf. — 30.  Sold  Peter  McGrath,  for  Cash,  our  entire 
stock  of  Goods,  amounting,  per  Inventory,  to  $3450. — Paid  S.  S, 
Packard,  in  full  of  %,  $3200. 

Trial  Balance. 

The  following  Trial  Balance  will  indicate  the  condition  of  the 
Ledger  containing  the  result  of  the  foregoing  transactions. 

The  student  should  be  required  to  render  his  statement  therefrom 
after  the  manner  of  the  statement  in  connection  with  Set  I. 


Face  of  Ledger. 


Dr.         Or. 


S.S.Packard,  .  . 
Merchandise,     .     . 

Cash, 

Expense,..  .  .  . 
J.  11.  Goldsmith,  . 
Bills  ReceivabiC,  . 
Robert  Baker,  .  . 
James  A.  Packard, 
Bills  Payable,  .  . 
Henry  Ivison,  .  . 
J.  C.  Bryant,  .  . 
L.  Faii'banks,    ,     . 


5750 

5750 

8250 

8971 

7747 

70 

5925 

175 

50 

15 

50 

15 

171 

50 

700 

350 

125 

125 
2500 

222 

50 

186 

293 

75 

23637 

45 

23637 

45 
50 

50 


45 


125 


SET    II. 


(In  Colors.) 


DAY  BOOK,  JOURNAL,  LEDGER  AND 
AUXILIARIES. 


LEDQBE  CLOSED,  AND  EESULTS  anOWN   IN  AN  IMPROVED   FORM  OF  BALANOB  SHEET, 
•WITH   FULL  EXPLANATIONS, 


liw«i'vv\,c%s  "Vyo%\ccyou.*. 


REMARKS. 


This  Set  Is  a  continuation  of  Set  I.,  although  the  nature  of  the 
business  undergoes  a  change.  The  merchandise  represented  in  the 
previous  Set  being  all  disposed  of,  we  now  invest  in  a  more  miscel- 
laneous stock,  comprising  a  general  assortment  of  groceries  and 
provisions.  Instead  of  keeping  a  distinct  account  with  each  article 
of  traffic,  as  in  Set  I.,  we  classify  all  under  the  title  of  "  Merchan- 
dise." This  is  the  usual  business  method,  and  should  always  be 
adopted,  except  where  it  is .  essential  to  know  the  gains  and  losses 
on  each  particular  kind  of  property. 

Having  a  net  capital  at  commencement,  the  first  entry  mast  per- 
tain to  the  existing  resources  and  liabilities.  Stock,  or  the  proprie- 
tor, is  credited  with  the  total  investment,  and  debited  with  the 
liabilities  assumed,  according  to  Principle  1. 

The  term  "  Sundries"  is  here,  for  the  first  time,  used  in  its  techni- 
cal sense.  It  means,  simply,  sundry  accounts^  and  is  convenient  as 
a  Journal  expression,  and  to  avoid  the  necessity  of  enumerating  tlie 
items  which  comprise  the  totals  carried  to  the  Ledger  accounts. 
This  convenience  wUl  be  immediately  apparent  by  comparing  the 
Ledger  entries  of  this  Set  with  those  of  the  preceding. 

Tlie  object  and  method  of  "  closing  the  Ledger"  is  also  fully  illus- 
trated ;  a  point  which  the  student  should  not  pass  lightly  over. 
The  great  difficulty  in  learning  the  science  of  Accounts  from  a  text- 
book, exists  in  the  tendency  to  copy  the  forms  and  exercises 
mechanically  without  a  proper  understanding  of  the  principles 
which  give  them  force. 

The  business  aspect  presented  by  the  forms  of  this  Set,  will  at 
once  commend  them  to  the  student,  as  models  for  his  emulation. 
The  red  ink  entries,  in  particular,  are  intended  to  remove  all  the 
obstacles  to  a  full  and  clear  understanding  of  the  instructions  given. 

In  short,  Set  II.  is  presented  as  embracing,  in  the  highest  degree, 
the  essential  qualities  of  Double  Entry  ;  and  as  Buch,  it  is  com- 
mended to  the  student's  most  careful  attention. 

128 


DAY  BOOK,- SET  II. 


New  York,  February  1,  1861. 

/ 

Commenced  Business  this  day  with  the  following  j 
Resources  and  Liabilities,  taken  from  Ledger 
A,     {See  Statement,  Page  121.)                    .      ' 

Resources. 

Cash  on  hand,                                   $8270  00 
Notes"      "                                         1050  00  j 
Peter  Cooper's  account,                     1750  00 
Jonas  Clark's        "                             6000  00 

* 

17070 

1 

1 15500 

1732 

1       87 

i 

423 

1 

750 

Liabilities^ 

/ 

Notes  outstanding,                            |600  00  1 
Smith  &  Sons'  account,                      6000  00 
George  Davis,        "                             750  00 
James  Ilathaway's"                            8250  00 

1 

/ 

Bo't  of  Comstock  &  Co.,  for  Cash, 

10  Hhds.  N.  0.  Mol.,  600  gal.,  @  40*   $240  00 
10      "      Cuba  Sug.,  9500  lbs.  "    6*     475  00 
17  Bags  Rio  Coffee,  1575   "    "  16*     252  00 
20Hf.Ch.Ool.Tea,1080   "    "50*     640  00 
10  Tierces  Rice,        6000   "    "    4i*  225  00 

^                   -                       1 

/ 

Sold  S.  S.  Randall,  on  %, 

3  Gals.  Molasses,                     e  60*       $1  50 
200  lbs.  Sugar,                          "6*       12  00 
150    "    Coffee,                          "  16*       24  00  i 

60 

J                                          1 

♦/ 

Sold  James  W.  Lusk,  on  his  Note  ®  30  ds., 

2  Ilhds.  Sugar,  2100  lbs.,        ®   6*  $126  00 
10  Hf.  Chests  Tea,  640  lbs.,    "  65*     297  00 

f                                           1 

J 

Paid  Cash  to  Geo.  Davis,  m  full  of  %, 

1 

50 

\ 

86612 

129 


DAY  BOOK -SET  II. 
New  York,  February  4,  1861. 


1/ 


Sold  Henry  C.  Spencer,  on  %, 

2  Hhds.  Molasses,  120  Gals,  ®  45* 
_, S    ^ 


Amotmt  Fortcard, 


Bo't  of  J.  A.  Tilford,  on  our  note  ®  60  ds., 

10  Tubs  Lard,  400  lbs,  ©  13*    '     62  00 

20  Boxes  Soap,  1400  lbs.,     "    7*         98  00 

5  Bbls.  Pork,  1000  lbs.,       "  10*       100  00 


85512 
54 


/ 


Sold  Ilarmer  Smith,  for  Cash, 

2  Bbls.  Pork,  400  lbs.,  ®  lOi*       42  00 

1  Tierce  Rice,  500  lbs.,         "    5*         25  00 


Sold  B.  F.  Carpenter,  on  %, 

2  Tierces  Rice,  1000  lbs.,      ®    5i*       55  00 
1  Bag  Rio  Coffee,  150  lbs.,  "  18*        27  00 


Bo*t  of  Clarence  Doubleday,  for  Cash, 

10  Bbls.  Potatoes,  @  $3  00     30  00 

1 000  lbs.  Eng.  Dairy  Cheese, "       1 8*  180  00 

!       7     


l/' 


Sold  James  Reed,  for  Cash, 

10  lbs.  Coffee,  ©18*  1  80 

3  Boxes  Soap,  210  lbs.,       "    8*         16  80 


Bo't  of  Robert  Hanaford,  for  Cash, 

10  Hhds.  Hav.  Sugar,  11000  lbs.  ©  5*    550  00 
3      "     N.  O.     *'        3700  "    "  6i*  203  60 


Sold  Henry  Van  Dyck,  on  %, 

9,  Hhds.  Havana  Sugar,  1970  lbs.,  ©  6* 


250 


67 


82 


210 


18 


50 


60 


753;  50 


118 


20 


870651  80 


130 


DAY  BOOK -SET  II. 

New  York,  February  10,  1861. 


/ 


/ 


./ 


Paid  James  Hathaway,  Cash  on  %, 
yj2  — 


AmownX  Forward, 


Sold  James  Hathaway,  on  %, 

1  Bbl.  Pork,  200  lbs.,  ©11*  22  00 

1  Bag  Rio  Coffee,  110  lbs,    "18*  19  80 

1  Hhd.  Hav.  Sugar,  900  lbs.  "    6*  54  00 

yj  


Sold  L.  Fairbanks,  on  %, 

100  lbs.  Eng.  Dairy  Cheese,  ®  25*         25  00 
1  Bbl.  Potatoes,  4  00 

y^  \ 


J    Sold  Henry  Van  Dyck,  on  %, 
4/  !  10  lbs.  Coffee, 


y 


@  18*  1  80| 

50    "    Eng.  Dairy  Cheese,    "  25*         12  50i 
50    "    Rice,  "    5i*        2  75 


^^ 


Paid  Cash  for  Rent  of  Store, 


Sold  J.  T.  Calkins,  for  Cash, 

150  lbs.  Eng.  Dairy  Cheese,  ®  25* 
^/ 


Reo'd  Cash  of  Henry  C.  Spencer,  in  fUll  of  %, 
_ ^  


37065 
4000 


Sold  S.  S.  Randall,  on  %, 
25  lbs.  Tea, 
60    "    Lard, 
20    "    Rice, 


®  56*         14  00 
»  15*  7  60 

"    6*  100 


Sold  Peter  Cooper,  on  %, 

2  Bbls.  Pork,  400  lbs.,  (»  11* 


131 


95 


29 


17 


100 


87 


54 


80 


80 


05 


60 


22 


44 


41465 


5C 


65 


DAY  BOOK,- SET  II. 
New  York,  February  22,  1861. 


^mottnt  Forward,    '■ 

Sold  E.  F.  HiD,  on  %, 

41465 

65 

/ 

1  Hf.  Chest  Tea,  64  lbs.,      ®  60* 

1 
[ 

82 

40 

Received  of  Jonas  Obrk,  in  full  of  %, 

! 

/ 

Cash, 

Note,  &  90  ds., 

$3000  00 
3000  00 

6000 
3000 

! 

>/ 

Paid  Smith  &  Sons,  Cash  on  %, 

/ 

Sold  George  Davis,  on  %, 

i 
1 

2  Hhds.  N.  0.  Molasses,  120  Gals. 

®  44f* 

63 

60 

^ff 

600 

/ 

Paid  Cash  for  our  Note,  favor  of  J.  R.  Wheeler, 

i 

Sold  E.  C.  Bradford,  for  Cash, 

i 
i 

>/ 

10  lbs.  Rio  Coffee,                ®  19* 
10   "    Tea,                             "  60* 
60   "    Rice,                           "    7* 

J27 

$1  90 
6  00 
3  60 

10 

40 

i 

Sold  Edwin  Morgan,  for  Cash, 

1 

»/ 

1  Tierce  Rice,  500  lbs.,       '  ®     6* 

2  Bbls.  Potatoes,                    "  3  00 

30  00 
6  00 

36 

100 

1 
1 

1/ ' 

P^d  Clerk's  Salary,  in  Cash, 

»^ 

51198  j  Of 

1 

1S2 


JOURNAL- SET  II. 
New  York,  February  1,  1861. 


Sundries,  Dr.      To  Stock, 

Cash, 

Bills  Receivable, 

Peter  Cooper, 

Jonas  Clark, 


1  Stock,  J)r»      To  Sundries,           j 

3  j  "  Bills  Payable,   ! 

3  I  "  Smith  &  Sons,  \ 

3  i  "  George  Davis,  \ 

3  1  '*  J.  Hathaway, 


Merchandise,  Dr. 

To  Cash, 
S  


8270 
1050 
1750 
6000 


15500 


17070 


S.  S.  Randall,  Dr. 

To  Merchandise, 
3  ___^___ 


Bills  Receivable,      Dr. 

To  Merchandise, 


George  Davis,  Dr. 

To  Cash, 
4 


Henry  C.  Spencer,  Dr. 

To  Merchandise, 
_: J- 


Merchandise,  Dr. 

To  Bills  Payable, 


Cash, 


Dr. 

To  Jtf  erchandise, 


138 


1732 


37 


423 


760 


54 


250 


67 


85888 


500 
6000 

750 
8250 


1732 


50 


50 


37 


423 


750 


54 


250 


67 
85888 


50 


50 


JOURNAL -SET  II. 
New  York,  February  6,  1861. 


AmowUt  Foneard,  f 

B.  F.  Carpenter,      Dr. 

To  Merchandise, 


Merchandise,  Dr. 

To  Cash, 

—    7 


Cash,. 


Dr. 
To  Merchandise, 

<:?  — 


Merchandise,  Dr. 

To  Cash, 

f 


Henry  Van  Dyck,    Dr. 

To  Merchandise, 
1  i/^ 


James  Hathaway,    Dr. 

To  Cash, 
-/^ 


James  Hathaway,    Dr. 

To  Merchandise, 

i/J 


L.  Fairbanks,  Dr. 

To  Merchandise, 

^^ 


Henry  Van  Dyck,  Dr. 

To  Mdse. 

^J 


Expense, 


Dr. 
To  Cash, 


Cash, 


Dr. 
lb  Merchandisef 


35883 
82 


2lO 


50 


18 


763 


118 


4000 


95 


29 


17 


100 


37 


41345 


60 


50 


20 


80 


05 


50 


15 


35883 
82 

210 

18 

753 


50 


118 


4000 


i    95 


29 


17 


100 


60 


50 


20 


80 


05 


87 


50 


41345 1  16 


134 


JOURNAL -SET  II. 
New  York,  February  17,  1861. 


Cash, 


Amounts  Forward, 

Dr. 
To  II.  C.  Spencer, 


4  j  S.  S.  Randall,  Br. 

'■i  To  Merchandise, 

I J20 


1  Peter  Cooper,  Dr. 

2  !  To  Merchandise, 


•2. 


E.  F.  Hill, 


Dr. 
To  Merchandise, 

J23 


Sundries,    Dr.    To  Jonas  Clark, 

Cash, 

Bills  Receivable, 

S^ 


41345 
54 


22 


Smith  <&  Sons,         Dr. 
To  Cash, 


George  Davis,  Dr. 

To  Merchandise, 

: Jie - 


44 


32 


Bills  Payable,  Dr. 

To  Cash, 


Cash, 


Cash, 


Expense, 


Dr. 
To  Merchandise, 

£7 

Dr. 
To  Merchandise, 

.J2S 

Dr. 

To  Cash, 


135 


3000 
3000 

8000 


53 


500 


10 


36 


100 


51108 


15 


50 


40 


60 


40 


05 


53 


40 


41345  15 
54 

22 

44 

32 
6000 

3000 

53 

500 

10 

86 

100 
51198  I  05 


60 


40 


Dr. 


LEDG-ER-SET  IL 
Stock. 


Or. 


fssr~ 

Feb. 

J) 

1 

28 

To  Sundries, 

"  Balance, 

1    \ 

16500 

2103    11. «, 

Feb. 

] 

By  Sundries, 
"  Loss  &  Gain 

1 
1.5 

1 

17070 
533 

05 

17603 

05 

17603 

i' 

OS 

1 

Dr. 


Bills    [Receivable. 


liBsr 

Feb. 


To  Stock, 

»  Mdse., 
"  Jon.  Clark, 


1060 

423 

3000 


4473 


Fth.    28 


By  Balance, 


Or. 


447S 


4473 


Dr. 


IPeter    Cooper. 


Or. 


Febu 

1 
20 

T-;  Stock, 
♦•  Mdse., 

1 
3 

1760 

18K 

;  Feb. 

28 

By  Balance, 

z= 

1 
1794 

1794 

|1794 

i 

i 

Dr. 


Febu 


1q  Stock, 


Jonas    Clark. 


6000 


136 


18«1 

FebL  '23    67  Sundries 


Or 


8 

J6000 

LEDG-ER-SET  II. 


Dr, 

Cash.. 

Cf 

• 

:86i 

Feb. 

II 

II 

M 
» 

n 

>i 
n 

1 
5 
7 
15 
17 
23 
26 
27 

To  Stock, 

"  Mdse., 
II      II 

n       II 

"  H.  Spencer, 

"  JonasClark, 

"  Mdse., 
II      11 

1 

II 

2 

II 

3 

» 

8270 
67 
18 
37 
54 

3000 
10 
36 

60 
50 

40 

1861 

Feb. 

II 

» 

!  » 

!      M 

It 
n 
» 
n 

11 

1 

3 

6 

8 

10 

15 

25 

26 

28 

II 

By  Mdse., 

"  Geo.  Davis, 

"  Mdse., 
II      II 

"  J.Hath'way 
"  Expense, 
"  Smith&Sons 
"  Bills  Pay'be 
"  Expense, 
"  Balance, 

1 

II 

2 
»i 

II 

n 

3 

II 

n 

1732 
750 
210 
•53 

4000 
100 

3000 
500 
100 
843 

50 

11493 

60 

11493 

60 

D^ 

m 

• 

Miercliandise. 

Cr 

vm 

i18«l 

b'eb. 

1 

To  Cash, 

1 

1732 

Feb. 

2 

By  S.S.  Randall 

1 

37 

5e 

6 

"  Bills  Payablo 

II 

250 

i» 

3 

"  Bills  Rec'ble, 

II 

423 

6 

"Cash, 

2 

210 

n 

1 

4 

"  H.  C.Spencer 

II 

54 

8 

n 

753 

60 

!  » 

5 

"  Cash, 

"    i 

67 

» 

28 

"  Loss  <k  Gain, 

733 

05, 

i    w 

6 

"  B.F.Carp'nt'r 

2 

82 

n 

7 

"Cash, 

II    I 

18 

SO 

w 

9 

"  H.Van  Dyck 

"    1 

118 

20 

• 

» 
n 

12 
13 

"  J.  Hathaway, 
"  L.  Fairbanks, 

»»    I 

II 

1 

95 
29 

80 

n 

14 

"  H.Van  Dyck, 

II 

17 

05 

/ 

n 

15 

"  Cash, 

II 

37 

JO 

n 

18 

"  S.  S.  Randall, 

3 

2? 

iO 

n 

20 

"  Peter  Co6per 

n 

At 

«i 

22 

"  E.  F.  Hill, 

n 

32 

10 

1 

» 

25 

"  Geo.  Davia, 

n 

53 

50 

1 

M 

26 

"  Cash, 

n 

10 

40 

M 

27 

n 

36 

II 

28 

"  Balan.,  {Inv.) 

11 

2!500 

8678 

B6{ 

3678 

68 

187 


8 


LEDGER -SET  IL 


Dr. 

Bills 

iPayable. 

Cr. 

1861 

2( 
28 

3'^^2i«, 

3 

50( 

199 

— t 
i 

1 

18«1 
Feb. 

1 
6 

By  Stock, 
"   Mdse., 

1 
1 

60( 

t5( 

Ui 

Dr. 


Smith.    &    Sons. 


Cr. 


1861 
Feb. 

28 

28 

ToCaah, 

3 

3OO0 

1000 

r 

«18«1 
Feb. 

1 

By  Sto<* 

1 

6OO0 

6000 

1 

6OO0 

Dr. 


G-eorge    Davis. 


Cr. 


1861 
Feb. 

3 

To  Cash, 
ToMdae., 

1 

750 

1861 
Feb. 

1 

By  Stock, 

By  Balance, 

I 

166 

Feb. 

2G 

8 

63 

60 

Fob. 

28 

S8 

«• 

1 
1 

i 

» 

Dr. 

James 

HatliaTvay. 

Cr. 

IMl 

Feb. 

n 

II 

10 
12 

28 

To  Cash, 

"  Mdse., 
"  BaianM, 

2 

1 

4000 

4154 

1 

86 

211 

1861 
Feb. 

1 

By  Stodi, 

« 

1 

8260 

8250 

00 

8260 

' 

1 

.  -.— .  -  . 

138 


Dr. 

LEDQEK-SET  IL 
S.    S.    Handall. 

Ot 

4 

• 

1S61 

Fob. 
li 

2 
18 

To  Mdse., 
»»       I) 

1 

3 

37 
22 

60 

60! 
JO 

\n. 

28 

By  Biiianca, 

— 

to 

60 

1 
1 

1 

Dr. 

Henry    O.    Spencer.              Cr 

Feb, 

4 

To  Mdae 

« 

1 

64 

1 

1B61 
Feb. 

1 

n 

By  Cash, 

3 

6i 

Dr. 

Henry    ^^an    Dyck.              Cr. 

1861 
Feb. 

9 
14 

To  Mdse. 
n        M 

> 

2 

118 
17 

2ol 
05 

m 

23 

By  Baiance,    ■ 

18S 

SB 

135 

26: 

136 

28 

,1 

Dr. 

.  L.    J^'airbanks.                    Cr. 

1861 
Feb. 

13 

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■f 

2 

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i 
1 

m 

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S9 

" 

. 

...  1 

Dr. 

Jllxpense.                          Cf 

» 
• 

18«1 
Feb. 

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28 

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a 

8 

100 
J  00 

200 

i 

j 

'm 

1 
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~ 

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200 

139 


Dr. 


LEDGER -SET  IL 
E.    F.    Hill. 


Cr. 


A41 
Peb.    122 


To  Mdae.. 


32 


10  ! 


1861 


22 


By  Balance, 


D 

• 

B, 

Jb'. 

Carpenter. 

Or, 

IMl 

Feb. 

6 

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2 

82 

1861 

,  Ftb. 

1 

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88 

Dr. 

Tioss    and    Grain. 

Cr, 

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Balance. 

tAMlMm. 

Cr, 

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"  Stock, 

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141 


ORDER  AND  PURPOSE  OF  CLOSING  THE  LEDGER. 


In-  the  preceding  Set  it  was  bought  best  to  leave  the  Ledger 
in  its  open  or  current  condition,  the  resvlts  of  the  business  being 
shown  in  a  separate  statement.  When  the  object  is  to  know  sim- 
ply the  condition  of  the  business,  this  method  is  sufficient ;  but 
when  it  becomes  necessary  to  mark  the  progress  of  the  business  in 
some  endui'ing  manner  upon  the  Ledger,  the  accounts  must  be 
"closed,"  and  the  balances  exhibited,  either  under  the  account  itself, 
or  in  some  other  account,  of  similar  import.  From  the  statement 
in  connection  with  the  previous  set,  the  student  has  learned  that 
the  Double  Entry  Ledger  contains  two  classes  of  accounts ;  one 
showing  the  present  condition  of  the  business,  by  representing  all 
its  resources  and  liabilities^  and  the  other  showing  its  jyrogress,  by 
representing  its  particular  gains  and  losses.  For  the  2)urpose  of 
distinction,  and  as  a  proper  designation  of  their  chai*acter,  we  shall 
call  the  former  of  these  two  classes.  Real,  and  the  latter  Repue- 
SEXTATivE.  By  Real  accounts,  therefore,  is  meant  those  which 
show,  in  the  difference  between  their  sides,  either  a  resource  or  a 
liability  ;  and  by  Representative,  those  which  show  in  the  same 
manner,  either  a  gain  or  a  loss.  The  student,  if  he  has  carefully 
examined  the  foregoing  instructions,  will  have  no  difficulty  in 
making  this  classification. 

The  object  of  "closing"  the  Ledger  is  to  put  an  end  to  its  cur- 
rent condition  by  disposing  of  the  Representative  accounts  ;  for 
inasmuch  as  the  proprietor  is  to  be  credited  Avith  his  net  invest- 
ment, whenever  that  net  investment  is  increased  by  gains,  his 
account  should  get  the  benefit  of  it.  As  it  would  be  impracticable 
to  carry  the  separate  gains  and  losses  to  the  proprietor's  account 
Avhen  they  accrue,  they  are  permitted  to  remain  in  the  accounts 
producing  them,  until  such  periods  as  may  be  deemed  best  to  trans- 
fer them.  This  is  usually  done  once  a  year,  and  in  some  establish- 
ments every  six  months,  thus  making  an  era  in  the  business,  and 
restoring  the  Ledger  to  its  proper  condition  of  showing  only 
resources  and  liabilities.  We,  shall  now  attempt  to  take  the  stu- 
dent carefully  through  the  process  of  "  closing  the  Ledger." 

142 


CLOSIITG    THE    LEDGER. 


PROCESS    OF    CLOSING. 

It  is  supposed  that  the  student  has  gone  through  with  the  pro- 
cess of  journalizing  and  posting  the  transactions  in  Set  II.,  and  that 
liis  Ledger  accounts  present  an  equilibrium  of  debits  and  credits. 
To  test  this  fact,  before  proceeding  farther,  Ave  will  take  a  • 


Dr. 

Trial  Balance. 

Cr. 

Difftrenett, 

Fact  of  L^dffer. 

Fact  ef  Udgtr. 

IHfftrtnett' 

95 
60 

25 
40 

15500 

4473 

1794 

6000 

11493 

2945 

500 

3000 

803 

4095 

60 

54 

lo5 

29 

200 

32 

82 

50 
50 

60 
80 

25 

40 

.  .  .  Stock, 

17070 

6000 
11145 

1178 
750 

6000 
750 

8250 

54 

50 
55 

1570 

250 
3000 

4154 

4473 
1794 

348 

.  .  .  Bills  Receivable, .  .  . 

.  .  .  Peter  Cooper, 

.  .  .  Jonas  Clark, 

.  .  .  Cash, 

1766 

53 
60 

135 
29 

200 
32 
82 

.  .  .  Merchandise, 

.  .  .  Bills  Payable, 

.  .  .  Smith  &  Sons,  .... 
.  .  .  George  Davis,  .... 
.  .  .  James  Hathaway, .  . 

.  .  .  S.  S.  Randall, 

.  .  .  Henry  C.  Spencer, .  . 
.  .  .  Henry  Van  Dyck, .  . 

.  .  .  L.  Fairbanks, 

.  .  .  Expense, 

.  .  .  E.  F.  Hill, 

.  .  .  B.  F.  Carpenter, .  .  . 

.  .  .  Equilibrixim, 

20 

8974 

20 

51198 

05 

51198 

05 

8974 

20 

The  above  form  of  the  Trial  Balance  is  the  most  comprehensive 
in  use,  and  one  which  we  would  recommend  for  its  utility.  li 
will  be  seen  that  the  footings  of  tlie  "  Face  of  Ledger"  columns 
exactly  agree  with  the  footings  of  the  Day  Book  and  Jourrial ; 
which  affords  conclusive  evidence  that  all  the  transactions  have 
found  their  way  to  the  Ledger.  The  columns  of  "  Differences," 
which  must  also  balance,  will  afford  a  convenient  test  of  the  results 
of  eacli  account. 

Having  satisfied  ourselves  that  the  transactions  have  been  prop- 
erly posted,  we  now  proceed  to  close  the  Ledger  accounts.  It 
must  not  be  forgotten  that  the  object  of  closing  the  Ledger  is  to 

143 


CLOSIITG    THE    LEDGER. 

present,  in  a  jiroper  manner,  both  the  prenent  condition  of  our  bus- 
iness and  its  progress.  Its  present  condition  tan  be  shown  by  a 
list  of  its  resources  and  liabilities ;  and  its  progress  by  a  list  of  its 
gains  and  losses. 

By  a  careful  examination  of  the  facts,  it  will  be  seen  that  re- 
sources are  shown  by  an  excess  of  the  debit  side  of  Real  accounts, 
and  liab'ilities  by  an  excess  of  the  credit  side  of  Real  accounts ; 
and  that  losses  are  shown  by  an  excess  of  the  debit  side  of  Repue- 
SEXTATivE  accounts,  and  gains  by  an  excess  of  the  credit  side  of 
Repuesentative  accounts.  This  will  suggest  tlie  propriety  of 
opening  two  accounts  for  these  general  results :  one  to  contain  the 
resources  and  liabilities,  and  the  other  the  gains  and  losses.  We 
■will  now  open  these  accounts  under  the  titles  of  "Loss  and  Gain," 
and  "  Balance,"  the  former  to  contain  the  results  of  the  Represex- 
tative,  and  the  latter  of  the  Re.vl  accounts.  Before  proceeding  to 
close  the  accounts,  we  must  ascertain  if  they  are  all  in  a  condi- 
tion to  show  the  results  desired.  The  Merchandise  account,  as  it 
now  stands,  shows  an  excess  of  the  debit  side,  and  would  therefore 
represent  a  loss,  if  the  merchandise  were  all  sold.  The  account 
itself  does  not  show  whether  the  property  is  all  sold  ;  and  the  only 
means  of  ascertaining  the  facts  in  the  case,  is  to  take  an  actual 
inventory,  or  a  valuation  of  that  which  remains  unsold.  When 
this  value  is  ascertained,  the  Merchandise  account  should  be  cred- 
ited with  it,  and  Balance  account  debited.  The  Merchandise  ac- 
count will  then  bo  competent  to  show  the  gain  or  loss  on  merchan- 
dise. We  have  estimated  the  unsold  merchandise  in  this  case  to 
be  worth  $2500,  which  amount  we  enter  on  the  credit  side  of 
Merchandise  account  in  red  inh*  and  transfer  the  same  imme- 
diately to  Balance  account.  The  accounts  are  now  in  a  condition 
to  close ;  and  we  will  take  them  in  their  order.  The  first  account 
(after  Stock,  which  is  the  proprietor's  own  account)  is  Bills  Receiv- 
able. This  account  represents  a  resource  consisting  of  other  peo- 
ple's notes  on  hand ;  the  debit  side  showing  the  notes  received,  and 
the  credit  side  those  disposed  of,  if  any.  We  close  the  account  by. 
entering  the  difference,  in  red  ink,  on  the  credit  side,  and  footing 
up  the  sides,  drawing  double  red  lines  vmderneath.  The  red  ink 
entry,  or  balance,  is  transferred  immediately  to  the  debit  side  of 

•  An  entry  in  red  ink  on  the  Ledger,  denotes  that  the  amount  thus  wrlten  m  to  be  trans- 
ferred, either  to  some  otlier  account,  or  to  another  position  under  the  same  account  It  also 
shows  that  the  entry  ii  fi-nt  made  in  the  Ledger,  not  having  passed  tlirough  tlie  usual  prelim- 
inary liooki  of  entry.  Reil  ink  entries  are  always  transferred  to  the  oppoiite  side  from  where 
tbey  are  first  written,  for  the  reason  that  they  indicate  an  excess  of  that  side. 

144 


CLOSING    THE    LEDGER. 

Balance  account. .  The  next  account,  Peter  Cooper,  is  closed  in  the 
same  way.  The  next,  Jonas  Clark,  already  balances,  and  we  close 
it  by  simply  ruling  the  double  red  lines.  The  next,  Cash  account, 
is  closed  in  the  same  manner  as  Bills  Receivable,  the  balance  being 
transferred  as  a  resource  to  Balance  account.  The  Merchandise 
account  shows  a  ffain,  and  the  balance  is  transferred  to  the  credit 
side  of  Loss  and  Gain  account.  Bills  Payable  account  shows  a 
UabUity,  and  the  balance  is  transferred  to  the  credit  side  of  Balance 
account.  Smith  &  Son's  account  also  shows  a  liability^  and  the 
balance  is  transferred  to  the  credit  side  of  Balance  account.  Georffo 
Davis'  account  shows  a  resource^  and  the  balance  is  transferred  to 
the  debit  side  of  Balance  account.  James  Ilathaway's  account 
shows  a  liability,  and  is  transferred  to  the  credit  of  Balance.  S.  S. 
Kandall's,  Henry  Van  Dyck's,  and  L.  Fairbanlc's  accoimts,  all  show 
resources,  and  are  transferred  to  the  debit  side  of  Balance.  Ex- 
pense account  shows  a  loss,  and  is  transferred  to  the  debit  side  of 
Loss  and  Gain.  E.  F.  Hill's  and  B.  F.  Carpenter's  accounts  both 
show  a  resource,  and  are  ti'ansferred  to  the  debit  of  Balance. 

We  have  now  the  residts  of  all  the  accounts  exhibited  under  the 
heads  of  Loss  and  Gain  and  Balance,  and  if  the  balances  have  been 
properly  transferred,  these  accounts,  together  Avith  the  (tmclosed) 
Stock  account,  must  be  in  equilibrium.  To  test  this,  we  next  take 
a  Trial  Balance  of  these  three  accounts,  which  Ave  call  the 


Second  Trial  Balance. 


Dr. 


Cr. 


Stock,.  .  .  . 
Loss  and  Gain, 
Balance,  .     .     , 


15500 

200 

9507 


25207 


17070 

733 

7404 


25!^07 


05 
20 


25 


Having  satisfied  ourselves,  by  this  test,  that  the  balances  have 
been  properly  transferred,  we  now  proceed  to  accomplish  the  grand 
object  of  closing  the  Ledger,  by  carrying  the  net  gain  from  the 
Loss  and  Gain  to  the  Stock  accoimt.  The  Stock  account  now  con- 
tains the  capital  invested  increased  by  the  gain,  which  must,  of 
course,  equal  the  present  worth,  as  shown  by  the  Balance  account. 
We  now  close  Stock  account  into  Balance,  which  must  produce  an 
equilibrium  of  the  Balance  account,  and  complete,  in  that  account, 
the  record  of  resources  and  liabilities. 

145 


CLOSING    THE    LEDGER. 

The  Balance  account  is  used  in  these  Sets  for  its  convenience  in 
collecting,  under  one  title,  all  the  resources  and  liabilities.  The 
Bame  effect  may  be  produced  by  bringing  down  the  balances  under 
the  Real  accounts.  This  -latter  method  is  adopted  in  business,  and 
particularly  where  the  record  is  continued  in  the  same  Ledger. 

From  these  remarks  and  applications  we  are  prepared  to  submit 
the  following  order  of  closing  the  Ledger,  Avhich  the  student  will 
do  well  to  observe  particularly,  and  to  follow  out  in  practice. 

ORDER    OF    CLOSING. 

First.  Open  an  account  with  "  Loss  and  Gain"  (if  not  already 
opened),  and  another  with  "  Balance,"  the  former  to  contain  the 
losses  and  (/ains,  and  the  latter  the  resources  and  liabilities. 

Second.  Ascertain  from  the  inventory  if  any  property  remains 
unsold  ;  and,  if  so,  credit  each  account  for  Avhich  such  property  was 
originally  debited,  with  tlio  value  of  that  unsold,  making  the  entry 
in  red  ink^  "  By  Balance,"  and  transferring  the  Jimount  directly  to 
the  debit  side  of  Balance  account,  making  this  entry  in  black  ink. 
"  To  Merchandise,"  or  "  To  Real  Estate,"  or  any  other  account 
from  which  the  amount  is  transferred.  The  Ledger  accounts  will 
each  show,  now,  one  of  the  four  following  results,  viz. :  a  Resource, 
a  Liability,  a  Gain,  or  a  Loss. 

Third.  Omitting  Stock  (or  the  Partners'  accounts),  commence 
with  the  first  account  in  the  Ledger.  First  ascertain  which  of  tho 
above  results  it  sho\^,  and  make  the  closing  entry  accordingly. 
If  the  difference  represent  a  resource  or  a  liabiUty,  enter  upon  the 
smaller  side,  in  red  ink,  "  To,"  or  "  By  Balance,"  as  the  case  may  be, 
and  transfer  the  amount  in  black  ink  to  the  opposite  side  of  the  Balance 
account.  If  the  difference  represent  a  gain  or  loss,  enter  on  the  smaller 
side  in  red  ink  "  To"  or  "  By  Loss  and  Gain,"  and  transfer  the  amount 
in  the  same  manner  to  Loss  and  Gain  account.  Close  all  the  accounts 
(except  Stock  or  Partners'),  and  transfer  the  balances  as  directed.  The 
Loss  and  Gain  account  will  now  show  on  the  debit  side  all  the  losses, 
and  on  the  credit  side  all  the  gains,  the  difference  being  the  net  loss  or 
net  gain.  The  Balance  account  will  show  on  the  debit  side  all  the  re- 
sources, and  on  the  credit  side  all  the  liabilities,  the  difference  being 
the  real  interest  or  present  investment  of  the  proprietor  or  proprietors. 

Fourth.  Take  a  second  Trial  Balance,  or  a  Trial  Balance  of  the 
remaining  open  accounts :  Stock  (or  Partners'),  Loss  and  Gain,  and 
Balance.  If  the  balances  have  been  properly  transferred,  the  debits 
and  credits  of  these  accounts,  taken  together,  must  be  equal. 

14G 


BALANCE    SHEETS. 

Fifth.  Close  Loss  and  Gain  account  into  Stock,  or,  if  it  be  a  part- 
nership business,  into  the  partners'  accounts,  dividing  the  gain  or 
loss,  according  to  agreement.  The  Stock  or  Partners'  Accounts 
will  now  show  the  oiiginal  investment  increased  by  the  gain,  or  do- 
creased  by  the  loss ;  the  difference  being  the  jvesetit  net  investment. 
Inasmuch  as  the  Balance  account  shows  the  same  thing,  they  must, 
of  course,  agree. 

Sixth.  Close  Stock  (or  Partners'  accounts)  into  Balance  account, 
which  must  equalize  that  account,  it  showing  now,  on  one  side,  the 
total  resources,  and  on  the  other  side  the  total  liabilities,  and  pre- 
senting, in  the  most  condensed  form,  the  exact  present  condition 
of  the  business. 


BALANCE    SHEETS. 


Ix  commercial  language  a  "  Balance  Sheet "  signifies  the  syste- 
matic arrangement  of  facts,  for  the  purpose  of  exhibiting  at  a  view 
the  condition  of  business.  The  forms  in  use  are  various,  according 
to  the  necessities  of  the  occasion  or  the  ingenuity  of  the  accountant. 
Of  these  the  example  given  on  page  141  comprises  the  most  com- 
plete and  symmetrical  of  which  we  have  a  knowledge.  The  follow- 
ing explanation  will  be  found  serviceable  in  preparing  this  sheet  for 
the  entries.  The  method  of  enforcing  the  fiicts  will  be  apparent  to 
any  diligent  student. 

1.  Take  a  sheet  of  paper  of  proper  size,  and  for  a  border,  rule 
double  red  lines  around  the  margin. 

2.  Rule  the  parallel  head-lines,  leaving  proper  sj^ace  for  double 
captions,  as  in  the  example. 

j3.  Ascertain  the  number  of  Ledger  accounts  to  be  represented ; 
which  will  embrace  all  the  accounts  in  the  Trial  l^alance  that  do 
not  cancel.*     If  the  business  is  that  of  a  single  i)roprietor,  usually 


♦  Should  there  bo  a  large  number  of  personal  flccount«,  it  will  be  found  difHcuIt  to  inrliide 
them  n\\  xeparateli/  in  this  form.  In  such  case  it  is  customary  t«  employ  the  two  general 
titles,  "Accounts  RecoivaWo,"  and  "Accounts  Payable."  the  one  embracin";  all  amounts  owinjf 
to  us  on  personal  %,  and  the  other  all  amounts  owinj?  bi/  us.  This  curtailuient  will  enable  tho 
facts  of  any  common  bueinc&s  to  bo  shown  in  this  form. 

147 


BALANCE    SUKETS. 

called  "  Stock "  business,  rule  in  pencil  as  many  lines  as  will  con- 
tain all  the  accounts  and  Jive  additional.  If  it  be  a  partnership 
business  with  two  or  more  partners,  rule  three  additional  lines  for 
each  partner ;  thus,  for  "  Stock  "  business,  five  lines  more  than  all 
the  accounts ;  for  two  partners,  eight  lines  more  than  all  tho 
accounts ;  for  three  partners,  elev€?i  lines  more,  and  so  on. 

4.  Lay  off  proper  spaces  for  debit  and  credit  money  columns ; 
first  for  the  footings  of  Ledger  Accounts,  second  for  Gains  and 
Losses,  third  for  Stock,  or  if  partners,  for  each  partner — and  fourth 
for  Resources  and  Liabilities ;  also,  for  a  single  money  column  for 
Inventories,  and  for  Ledger  titles  and  their  Ledger  folios.  The 
position  of  these  columns  will  be  seen  in  the  example  given.  These 
spaces  can  best  be  appropriated  by  using  a  pair  of  dividers,  and 
giving  each  of  the  captions  its  just  proportions. 

5.  After  denoting  the  proper  space  for  each  heading,  which  can 
best  be  done  with  pencil,  commence  to  rule  in  red  ink  at  the  right 
hand  and  bring  all  the  lines  of  the  two  captions,  "  Real  Accounts" 
and  "  Stock,"  or  one  of  the  partners,  down  to  the  lower  pencil  line. 
For  the  other  partners  drop  two  lines.  For  Losses  and  Gains  droj) 
two  lines  in  Stock  business,  and  one  additional  for  each  partner. 

6.  Rule  the  foot  lines  as  shown,  and  the  schedule  will  be  ready 
to  receive  the  accounts. 

The  process  of  showing  results  is  precisely  similar  in  its  order, 
and  the  results  the  same  as  in  "  closing  the  Ledger,"  which  has 
already  been  so  fully  explained  as  to  need  nothing  further. 

There  are  many  kinds  of  business  statements  in  use,  each  posses- 
sing some  peculiar  merit,  and  all  having  the  same  general  purpose 
in  view,  viz  :  that  of  exhibiting  the  real  and  progressive  condition 
of  the  business  represented.  The  forms  hitherto  used  in  this  work, 
and  particularly  the  one  on  page  121,  are  both  simple  and  com- 
prehensive, and  would  possibly  be  preferred  by  one  not  versed  in  the 
processes  and  technicalities  of  Book-keeping ;  but  we  know  of  no 
form  that  compasses  so  much  within  such  limited  space,  as  that 
described  above.  The  example,  on  page  141,  will  sufficiently  indi- 
cate the  points  of  excellence,  and  give  the  student  a  model  for  his 
emulation.  Let  him  remember  that  in  no  one  thing  does  the  pro- 
ficiency of  a  practical  accountant  more  plainly  manifest  itself  than 
in  the  matter  of  neatness  in  arrangement  and  execution.  The  art 
of  ruling  tastefully,  unimportant  as  it  may  seem,  is  one  not  easily 
acquired  nor  overrated. 

148 


EXAMPLES    FOR    PRACTICE. 


The  student  is  requested  to  render  statements  after  the  form  on 
page  141,  from  the  following  materials. 


Example  1.        Trial  Balance.        J)f^ 


Cr. 


Stock, 

Bills  Receivable,     ...... 

John  Mason, 

Cash, 

Merchandise,    (Amount  unsold,  $1200) 

Peter  Smith, 

Robert  Pendergast, 

Expense, 

Bills  Payable, 

Charles  Ryan, 


881 
1500 

300 
5794 
3500 
4000 

375 
1500 


17851 


67 


«3 


5000 
1000 

175 
4800 
2759 
1500 

384 

1750 
483 


50  17851 


50 


50 


Example  2. 


Trial  Balance. 


Dr. 


Cr. 


Stock, 

Merchandise,  (Amount  unsold,  $1000.) 

George  Hopkins, 

Robert  Westcott, 

Abrara  Woodfall, 

Peter  Denyse, 

Robert  Rantoul, 

James  Jackson, 

E.  E.  Ellsworth, 

Cash, 

Expense, 

Commission, 

Bills  Receivable, 

Bills  Payable, 

Shipment  to  Detroit, 

Edward  Rice, 

Peter  Ren  wick, 

Edwin  C.  Packard, 

Benj.  F.  Holmes, 

F.  R.  Perley, 


"14^ 


141 

5000 

1500 

753 

900 

110 

732 

75 

500 

9753 

450 

170C 

1500 

4000 

700 

50 

900 

76 

500 

29340 


78 


98 


20 


96 


3000 

3700 

953 


500 
500 

983 
8748 

183 

150 

5000 

4598 

874 

150 


29340 


84 


90 
22 


96 


EXERCISES   FOU   THE   LEARNER. 
SECoivrr)     SERIES. 


Memoranda. 

February  1.  Commenced  business  with  the  following  resources 
and  liabilities,  taken  from  the  Balance  Sheet  of  Ledger  A* — 
Resources:  Cash,  $1822  20;  Bills  Receivable,  $171  50;  Robert 
Barker's  account,  $350 ;  Henry  Ivison's  do.,  $222  50 ;  J,  C. 
Bryant's  do.,  $186;  L.  Fairbanks'  do.,  $299  15;  Liabilities;  our 
note  favor  of  James  Dawes,  for  $2500. — Bo't  of  Springer  and 
AYhiteman,  on  %,  20  Bags  Rio  Coffee,  1670lbs.,  ©  15^;  15  Tierces 
Rice,  VSOOlbs.,  @  4^;  15'Hhds  Cuba  Sugar,14000lbs.,@5^.— 2.  Bo't 
of  Alex.  Cowley,  for  Cash,  12  HhdsN.O.  Molasses,  720  gals  ®  40^; 
20  Boxes  Soap,  1450lbs.,  ©  B'^,  10  Bbls  Pork,  2000lbs,  @  10*^.-3. 
Sold  Lewis  Lyman  on  %,  30lbs.,  Coffee,  ©18*?;  20  do.  Rice,  ®  5¥; 
100  do.  Sugar,  @  6^. — Received  Cash  of  Robert  Barker,  in  full  of 

%,  $ . — 4.  Paid  Cash  for  Stationery,  and  incidental  expenses, 

$20.-5.  Sold  Alonzo  Mitchell,  on  %,  1  Bag  Rio  Coffee,  SOlbs.,  ® 
18f ;  20  gals.  N.  O.  Molasses,  ®  50*  ;  SOlbs.  Rice,  @  5if.— Bo't  of 
Peter  Duff,  for  Cash,  300lbs.,  English  Dairy  Cheese,  @  20*? ;  250lbs., 
Butter,  @  18*. — Sold  John  R.  Penn,  on  his  note  ©30  ds.,  5  Boxes 
Soap,  350lbs.,  ©  10*;  6  Bags  Rio  Coffee,  485lbs.,  @  16*.— 6.  Bo't 
of  S.  S.  Packard,  on  our  note  ©10  ds.,  40  Hf  Chests  YII  Tea, 
2356lbs.,  ©  35*.— Sold  Charles  Strong,  for  Cash,  10  Hf.  Chests  Tea, 
580lbs.,  ©  38*;  lOOlbs.  Enghsh  Dairy  Cheese,  ©  22*.— 9.  Sold 
Samuel  Davis,  for  Cash,  50lbs.  Butter,®  20*  ;  SOlbs.  Coffee,  ©  18*; 
30  gals.  Molasses,  ©  50*.— 10.  Sold  Henry  Dwight,  for  Cash,  30 
gals.  Molasses,  ©  50*;  lOlbs.  Rice,  ©  G* ;  1  Box  Soap,  75lbs.,  © 
10*. — 12.  Paid  Clerk's  salary. in  Cash,  $15. — Bo't  of  James 
Simpson,  on  %,  15  Bbls  Crushed  Sugar,  2520lbs.,  ©  10*. — 15.  Rec'd 
Cash  on  %  of  Henry  Ivison,  $100. — Sold  Thomas  Hunter,  on  %,  5 
Hf  Chests  Tea,  275lbs.,  ©50*;  50lbs.  English  Dairy  Cheese,© 
23*;  25lbs.  Rice,  ©  5*.^S6ld  Henry  Ivison,  on  %,  20  gals. 
Molasses,  ©50*;  3  Boxes  Soap,  210lbs.,  ©  10*. — 16.  Rec'd  Cash 
in  full  of  J.  C.  Bryant's  %,  $—— .— Sold  W.  H.  Joeckel,  for  Cash, 
2  Bbls.  Crushed  Sugar,  330lbs.,  ©  11*. — 17.  Sold  Lewis  Lyman  on 
%  50lbs.  Rio  Coffee,  ©  20*;  lOOlbs.  Crushed  Sugar,  ©  11  *.— 19. 
Paid  Cash  in  full,  for  our  note,  favor  of  S.  S.  Packard,  dated, 
Feb.  6,  due  this  day,  $824  GO. — 20.  Sold  Robert  Burns,  for  Cash, 

*  See  Trial  Balance,  page  125. 

150 


EXERCISES    FOR    THE    LEARNER. 


lOOlbs.  Crushed  Sugar,  ®  1  If. — Received  Cash  of  Henry  Ivison,  in 
full  of  %,  $153  50.— 22.  Paid  James  Simpson  Cash  in  full  of  % 
$252.— Sold  Philip  Stone,  for  Cash, '4  Hf.  Chests  Tea,  225lbs.  & 
60"f. — 23.  Sold  Thomas  Hunter,  on  %,  50lbs.  English  Dairy  Cheese, 
@  25'f ;  75  do.  Crushed  Sugar,  @  11* ;  15  do.  Coifee,  @  20f ;  2  Boxes 
Soap,  140lbs.,  @  10'^.— 25.  Sold  Alonzo  Mitchell,  on  %,  2  Hhds. 
Cuba  Sugar,  1850lbs  ®  6*. — Received  Cash  in  full  for  J.  M.  Brad- 
street's  note  of  the  3d  ult.,  due  March  5,  $171  50. — 27.  Paid  Cash 
for  Store  rent,  $100. 


STATEMENT. 


The  Student  is  expected  to  produce  the  following  result  from  the 
foregoing  transactions : — 

Trial   Balance. 


Stock,    

Bills  Receivable, 

Cash, 

L.  Faii'banks, , 

Alonzo  Mitchell,      ...... 

Merchandise,  (Amount  unsold,  §2500.) 

Bills  Payable, 

Springer  &  Whiteman,    .... 

Lewis  Lyman, 

Expense, 

Thos.  Hunter, 


2500 
284 

3242 
293 
137 

3036 
824 

33 
135 

188 


10 
50 
75 
05 
10 
60 

50 


10674    60     10674    60 


3045 

171 

1920 


961 
3324 
1260 


95 
50 
60 


45 
60 
50 


Balance  Account. 


Resources.    Liabilities. 


Merchandise,  .  .  . 
Bills  Receivable,      .     . 

Cash, 

L.  Fairbanks,  .  .  . 
Alonzo  Mitchell,  .  . 
Bills  Payable,  .  .  . 
Springer  &  Whiteman, 
Lewis  Lyman,  .  .  . 
Thos.  Hunter,  .  .  . 
Stock,    (Present  worth,)  . 


151 


2500 
112 

1321 
293 
137 


33 

188 


4586     80 


50 


2500 
1260 


836 
4686 


60 


30 
80 


QUESTIONS    FOR    REVIEW. 


QUESTIONS    FOR    REVIEW. 


Appropriate  answers  to  the  following  queries  may  be  found  on 
the  pages  indicated.  The  more  direct  reference  by  figures  will  be 
Ijenceforth  discontinued. 

REMARKS,   PAGE  128. 

1.  In  what  sense  is  tliis  a  continuation  of  Set  I?",  2.  "Wliat  different  plan  is 
adopted  in  tlie  keeping  of  property  accounts  ?  3.  When  is  it  customary  to  keep 
other  than  a  general  Merchandise  account?  4.  When  the  business  commences 
with  a  capital,  what  is  the  first  entry  ?  5.  What  account  is  credited  with  the 
investment?  6.  What  does  Stock  account  represent?  7.  What  is  the  technical 
meaning  of  the  term  "Sundries?"  8.  Why  is  it  used  in  Journal  or  Ledger 
entries? 

ORDER  AND  PURPOSE  OF  CLOSING  THE  LEDGER,  PAGE  142. 

9.  In  what  condition  was  the  Ledger,  Set  I.  left?  10.  Under  what  circum- 
Btances  is  this  sufficient?  11.  Wlien  is  it  necessary  to  "close"  the  Ledger 
accounts?  12.  When  an  account  is  closed  how  is  the  balance  or  difference  exhibi- 
ted? 13.  How  many  classes  of  accounts  are  there  in  Double  Entry?  14.  What 
is  the  distinction?  15.  What  are  they  called?  16.  What  is  meant  by  Real 
accounts?  17.  What  by  Representative  ?  18.  What  is  the  object  of  closing  the 
Ledger?  19.  Why  are  the  gains  and  losses  in  business  permitted  to  remain  in  the 
Representative  accounts,  instead  of  being  carried  directly  to  the  proprietor's 
account?  20.  How  often  is  it  customary  to  credit  the  proprietor  with  his  gains? 
21.  To  what  condition  is  tho  Ledger  restored  when  the  gains  and  losses  are 
transferred  to  tho  proprietor's  account  ?  22.  What  is  the  first  thing  necessary  after 
posting  all  thfe  entries  to  the  Ledger?  23.  In  what  sense  is  tho  Trial  Balance  a 
test  of  the  correctness  of  the  work?  24.  What  two  features  are  presented  by  the 
Trial  Balance  on  page  143  ?  25.  How  may  the  present  condition  of  a  business  be 
shown?  26.  How  are  resources  shown  on  tho  Ledger?  27.  How  liabilities? 
28.  How  losses?  29.  How  gains?  30.  What  two  accounts  may  bo  opened  to 
to  show  these  results?  31.  What  is  contained  in  the  Loss  and  Gain  account? 
32.  What  in  the  Balance  account?  33.  Can  you  learn  from  tho  Merchandise 
account  the  value  of  Merchandise  unsold?  34.  How  is  it  ascertained  ?  35.  When 
the  ilerchandise  account  is  credited  with  the  inventory  of  unsold  Merchandise, 
what  will  the  account  represent?     36.  What  is  the  process  o{  closing  an  account? 

37.  In   closing   an   account,  why  is  the    difference   placed    on   the  smaller  side? 

38.  What  test  have  we  for  ascertaining  if  the  balances  of  the  accounts  are  properly 
transferred?  39.  What  accounts  are  contained  in  the  "Second  Trial  Balance?" 
40.  Why  will  the  difference  in  the  Stock  account,  after  the  gain  or  loss  has  been 
transferred,  equal  the  difference  in  the  Balance  account  when  all  the  resources  and 
liabilities  have  been  entered  ?  41.  Is  it  necessary  in  closing  the  Ledger  to  open  a 
Balance  account?  42.  How  may  the  same  efiect  be  produced?  43.  What  is  tho 
first  step  in  the  order  of  closing?  44.  Second?  45.  Third?  46.  Fourth? 
47.  Fifth?    48.  Sixth?     ' 

152 


SET    III. 


(Corresponding  with  Set  IH,  Part  L) 

DAY  BOOK  AND  JOURNAL  COMBINED. 


•WITH    rCLIi   STATEMENTS    AND    EXPLANATIONS,    SHOWING    THE    DISTINCTIONS 
BETWEEN    SINGLE    AND    DOUBLB  ENTKY. 


"Swsmc/ftft  -WdiNi-cvse;. 


REMARKS. 


The  transactions  comprising  this  set  are  the  same  as  those  in 
Set  III.  Part  I.  and  are  .selected  for  the  purpose  of  showing 
the  exact  difference  betAveen  Single  and  Double  Entry.  A  careful 
study  of  the  two  sets  in  their  similar  and  dissimilar  points  will  open 
to  the  mind  of  the  student  a  clearer  distinction  between  the  two 
methods  of  accounts  than  could  be  effected  by  any  other  form  of 
reasoning.  This  distinction  is  most  apparent  in  the  Ledger  where 
it  will  be  seen  that  the  additional  accounts  required  by  Double 
Entry  relate  exclusively  to  particular  speculations,  and  are  useful, 
mainly,  to  denote  special  gains  and  losses.  If  our  anxiety  to  keep 
this  fact  prominently  before  the  mind  should  lead  us  into  unneces- 
sary repetitions,  we  still  think  this  evil  less  than  that  of  leaving  the 
point  obscure. 

Another  decided  improvement  in  this  over  the  preceding  Set 
(II.),  relates  to  the  form  of  the  original  book  of  entry,  which  here 
combines  the  Day  Book  and  Journal.  There  is  no  doubt  as  to  the 
preference  of  this  plan  over  that  of  separate  books.  The  only 
objection  that  can  be  arrayed  against  it  is  the  difficulty  sometimes 
of  combining  the  historical  with  the  journal  expression  in  a  manner 
to  preserve  the  unity  of  the  entry  without  destroying  the  indi- 
viduality of  its  parts.  A  little  practice,  however,  will  remove  this 
difficulty,  and  lead  the  student  into  a  concise  and  symmetrical  form 
of  expression,  at  once  comprehensive  and  business-like. 

We  have  not  deemed  it  necessary  to  repeat  the  auxiliary  forms 
of  Sales  Book,  Cash  Book,  and  Bill  Book,  for  the  reason  that  we 
could  suggest  no  improvement.  ■  Auxiliary  Books  are  used  for  their 
convenience  in  classifying  the  departments  of  business,  and  do  not 
pertain  necessarily  to  any  particular  theory  or  method  of  accounts. 
In  Single  Entry,  however,  they  are  often  essential  in  presei*ving  a 
sufficient  record  of  resources  and  liabilities,  which  in  Double  Entry 
are  shown  independently  in  the  Ledger. 

The  manner  of  closing  the  accounts  differs  from  Set  II.  only  in 
bringing  down  the  resources  and  liabilities  under  the  accoimts 
themselves,  instead  of  transferring  them  to  a  separate  account  like 
"  Balance."  A  few  of  the  accounts,  containing  only  one  item,  are 
unnecessarily  closed,  and  the  balances  brought  down.  This  plan  is 
,<K)metimes  adopted  in  business,  for  the  purpose  of  exhibiting  the 
condition  of  affairs  on  the  Ledger  at  sotne  certain  date. 

The  method  of  showing  general  results  through  a  detailed  state- 
ment is  commended  to  the  careful  attention  of  the  student. 

154    - 


JOURNAL  DAY  BOOK -SET  III. 

Albany,  July  1,  1861. 


Sundries,  Dr.  To  II.  B.  Bkyant, 

For  Investment,  as  follows. 
Merchaxdise,       As  per  Inventory, 


Bills  Rec'ble, 

Cash, 

John  R.  Penn, 

L.  Fairbanks, 

Alonzo  Gaston, 


"     "   Bill  Book, 
"     "   Cash  Book, 
Balance  of  %, 


Sundries,  Dr.  To  H.  D.  Stratton, 

For  Investment,  as  follows. 
Real  Estate,       House  and  lot,  vaL  at. 
Cash,*  Am't  in  Union  Bank, 


Expense,  Dr. 

To  Cash, 
Paid  for  postage    stamps, 
pens,  &c.. 


Casu,  Dr. 

To  Merchandise, 

Sold   Robl.    Van  Schaick, 
per  S.B., 

. .  £  


Cash,  Dr. 

To  John  R.  Penn, 

Received  on  %, 


Expense,  Dr. 

To  Cash, 
Paid  for  printing  Hand-Bills 


4750 

1500 

1200 

500 

V50 

375 


5000 
3000 


39 


250 


10 


17379 


9075 


8000 


39 


250 


10 


17379 


•  Some  houses  keep  a  regular  Bank  ncconnt  in  their  main  books,  debiting  the  bank  with  flepo- 
sits.  anrl  creiliilnsr  it  with  cliecks  drawn,  while  others  keep  the  account  only  in  an  auxiliary 
book,  and  count  the  cash  in  bank  the  same  as  that  in  safe.  Wc  have  in  this  Instaucc  adopted  tho 
latter  plan. 

155 


JOURISTAL  DAY  BOOK- SET  III. 


Albany,  July  3,  1861. 


Amounts  Forward, 

James  Johnson,       Dr. 

To  Merchandise, 
Per  Sales  Book, 


Cash,  I>r. 

To  Merchandise, 
Petty  sales,  per  C.B., 

4  


Bills  Receivable,   Dr. 

To  Merchandise, 
Sold  E.  H.  Bender,  per  aB., 


Expense,  Dr. 

To  Cash, 

Paid  C.  Jones,  repair'g  store, 

^    


Merchandise,  Dr.  To  Sundries, 

To  Clafflin  Mellen  &  Co., 

Invoice  of  Boots  and  Shoes, 

"    A.  T.  Stewart  &  Co.,  Invoice 

of  Dry  Goods, 

"    Cash,        Paid  freight  on  above, 
. 7— — 


E.  B.  Rice,  Dr. 

To  Merchandise, 
Per  Sales  Book, 


Cash,  Dr. 

To  Alonzo  Gaston, 

Ecceived  in  full  of  %, 

156 


17379 
192 


17 


108 


175 


1359 


42 


375 


19648 


50 


20 


50 


45 


Ql 


17379 
192 

17 


108 


175 


575 
757 

27 

42 


375 


19648 


50 


20 


5C 


45 


65 


JOURNAL  DAY  POOK-SET 

Albany,  July  7,  1861. 


III. 


3 


AinounU  Forward, 

Expense,  '  Dr. 

To  Cash, 
Paid  Clerk  hire, 

. <?    


Casu,  Dr. 

To  Merchandise, 
SoldW.  H.  Clark,  per  S.B., 


Expense, 


Dr. 
To  Cash, 
Paid  expenses  to  N.Y., 


Benjamin  Payn,      Dr. 

To  Merchandise, 

Per  Sales  Book, 


Cash,  Dr. 

To  Bills  Receivable, 
Infullof  Robt  Brace's  note. 


A.  T.  Stewart  &  Co.,  Dr. 
To  Cash, 

Paid  them  on  %, 


Bills  Receivable,   Dr. 

To  Merchandise, 
Sold  C.  S.  Sill,  per  S.B., 

157 


19648 
25 


65 


19 


15 


23 


500 


300 


173 


82 


75 


41 


20705 


63 


19648 
25 


65 


19 


15 


23 


500 


300 


173 


20705 


82 


41 


JOURNAL  DAY  BOOK -SET  III. 

Albany,  July  12,  1861. 


Amounts  Forward, 

20705 

63 

20705 

63 

1 

H.  D.  Steatton,       -Z>r. 

75 

6 

To  Bills  Payable, 

75 

2 

Accepted    draft,    favor    of 
P.  R.  Spencer,  per  B.B., 

33 

50 

Cash,                          JDr. 

1 

To  Mbrchajtdise, 

Received   for    petty  sales, 
per  C.B., 

33 

50 

5 

Amos  Dean,             Dr. 

180 

1 

To  Merchastdise, 

Per  Sales  Book, 

180 

4 

^.R 

575 

^ 

Clafflin,  Mellen  &.  Co.,  Br. 

5 

To  Bills  Payable, 

Our  note  to  balance  %, 

575 

4 

V.^ 

75 

H.  B.  Bryant,          Dr. 

2 

To  Cash, 

75 

2 

Paid  him  on  %, 

350 

Cash,                          Dr. 

3 

To  L.  Fairbanks, 
Received  on  ^, 

350 

2 

</^ 

252 

Cash,                          Dr. 

1 

To  Mercha]st)ise, 
Sold  G.  H.  Doty,  per  S.B., 

252 

22246 

1 

13 

22246 

\ 

13 

■  r 

158 


JOUHNAL  DAY  BOOK -SET 

Albany,  July  19,  1861. 


III. 


Amounts  Forward, 

Expense,  Dr. 

To  Cash, 
Paid  for  Advertisements  in 
Evening  Journal, 

£(P 


Victor  M.  Rick,       Dr. 

To  Merchandise, 
Per  Sales  Book, 


Cash,  Dr. 

To  Victor  M.  Rice 

Received  on  %, 


Expense,  Dr. 

To  Cash, 
Paid  petty  expenses  per  C.B. 


Cash,  Dr. 

To  Amos  Dean, 

Received  on  %, 


Expense,  Dr. 

To  Cash, 
Bill  of  Carpenter  work  $175 
Drayage,  $5 ;  Porterage,  $3 

• £^ 


Bills  Receivable,  Dr. 

To  Merchandise, 
Sold  J.  R.  Morgan,  perS.B. 

*  159 


22246 
16 


82 


30 


10 


60 


183 


339 


13 


88 


22966    01 


22246 
16 


82 


30 


10 


60 


183 


3S9 


13 


88 


22956    01 


^ 


JOURNAL  DAY  BOOK -SET  III. 
Albany,  July  23,  1861. 


Amounts  Forward, 

James  Shelden,        Dr. 

To  Merchandise, 
Per  Sales  Book, 


Cash,  Dr. 

To  Merchandise, 
Sold  R.  Metcal^  per  S.B., 

£4 


Cash,  Dr. 

To  Merchandise, 

Sold  Chas.  Heydon,  per  S.B. 


Cash,  Dr. 

To  E.  B.  Rice, 

Received  in  full  of  %, 

^^ 


William  Shepard,  Dr. 

To  Merchandise, 

Per  Sales  Book, 


Cash,  Dr. 

To  Merchandise, 
Sold  Robt.  Dawes,  per  S.B., 


Bills  Payable,         Dr. 
To  Cash, 
Paid  on  Accept,  fav.  H.D.S. 


Expense,  Dr. 

To  Cash, 
Paid  Clerk  hire, 


22956 
132 


234 


106 


42 


37 


163 


75 


25 


23771 


01 
24 


45 


55 


20 


45 


22956 
132 

234 

106 

42 

37 


163 


75 


25 


01 
24 


45 


55 


20 


23771 


45 


160 


JOURNAL  DAY  BOOK -SET 

Albany,  July  26,  1861. 


III. 


Amounta  Forward, 

John  Bejlden,  I>r. 

To  Merchandise, 

Per  Sales  Book, 


A.  T.  Stewart  &  Co.,  Dr. 
To  Cash, 
Paid  them  in  full  of  %, 

^/ 


Cash,  Dr. 

To  Merchandise, 
Sold  J,  H.  Lansley,  per  S.B. 

S^-. 


Cash,  Dr. 

To  Merchandise, 
Sold  W.  H.  Fiquet,  per  S.B. 


Cash,  Dr, 

To  John  R.  Penn, 

Eeceived  in  full  of  ^, 

£^ 


Sundries,  Dr.  To  Merchandise, 

SoldChaa.  A.  Sooley,  p'pS.B 
Cash,  Amount  received, 

Chas.  a.  Seeley,  Balance  on  %, 


161 


23771 
216 


457 


138 


154 


250 


75 

107 

25170 


45 
50 


72 


40 

07 


23771 
file 


45 

50 


457 


138 


72 


154 


250 


182 


25170 


40 


07 


LEDG-EK-SET  III. 


Dr. 

H. 

B 

». 

Bryant. 

Cr 

• 

ISOl 

July 
» 

15 
31 

To  Cash, 
"   Loss  &  Gain 
"   Balance, 

4 
l6 
l1 

75 
352 

8C47 

94 

06 

1861 

July 

1 

By  Sundries, 
By  Balance, 

1 

9075 

9075 

00 

9075 

Aug 

1 

Ll 

8647 

06 

Dr. 

H. 

33 

.    Stratton. 

a 

• 

ISGt 

July 

12 
31 
31 

ToBillsPayable 
"  Loss  &  Gain, 
"  Balance, 

4 

L6! 

Ll 

75 
352 

75T2 

94 
06 

1861 
July 

1 

By  Sundries, 
By  Balance, 

1 

Ll 

8000 

8000 

00 

8000 

00 

Aug 

1 

7572 

06 

Dr, 

]V£ercliaiidise. 

Cr 

'• 

1S61 

1861 

July 

1 

To  H.  B.  Bryant 

1 

4750 

July 

1 

By  Cash, 

1 

39 

5 

"  Sundries, 

2 

1359 

50 

» 

)) 
)) 
)) 
)l 
II 
II 
II 
II 
11 
II 

II 
II 
II 
II 
II 
II 
II 
11 
II 

3 

11 

4 

7 

8 

10 

12 

13 
18 
20 
22 

23 

11 

24 

25 

11 

26 
27 
29 

30 

II 

"  J.  Johnson, 

"  Cash, 

"  Bills  Rec'ble, 

"  E.  B.  Rice, 

"  Cash, 

"  Benj.  Payn, 

"  Bills  Rec'ble, 

"  Cash, 

"  Amos  Dean, 

"  Cash, 

"  Vict.  M.  Rice 

"  Bills  Rec'ble, 

"  Jas.  Shelden, 

"  Cash, 
II     II 

"  "W.  Shepard, 
"  Cash, 

"  John  Belden, 
"  Cash, 

11     11 

"  Sundries, 
"  Balance, 

2 

II 
II 

3 

II 

4 

II 

11 

5 

11 

6 

II 

11 
11 
II 

7 
II 

11 

Ll 

192 

.17 

108 

42 

19 

23 

173 

33 

180 

252 

82 

339 

132 

234 

106 

37 

163 

216 

138 

154 

182 

8000 

50 
20 
45 
82 
41 

50 

88 
24 

55 
20 
50 
72 

40 

To  Balance, 

Ll 

11 

II 

"  Loss  &  Gain, 

l6 

242 

18 

6109 

50 

6109 

50 

Aug 

1 

3000 

162 


Dr. 


LEDGER -SET  III. 
Bills    [Receivable. 


Cr. 


1S61 
July 

» 
» 

1 

4 

12 

22 

To  H.B.  Bryant, 

"  Mdse., 

»      II 

i>      » 

To  Balance, 

1 
2 
3 
5 

1500 
108 
173 
339 

2120 

20 
20 

ISGl 
July 

10 
31 

By  Cash, 
"   Balance, 

3 

l2 

500 
1620 

20 

2120 

20 

Aug 

1 

1620 

20 

Dr. 


Jolin    [R.    p*eiiii. 


lS6t 
July 


To  II.  B.Bryant, 


500 


500 


1861 
July 


By  Cash, 


Dr, 


Cash.. 


1S61 

July 


Aug 


To  H.  B.Bryant, 
"  lI.D.Stratton 
"  Mdse., 
"  J.  R.  Ponn, 
"  Mdso., 
"  A.  Gaston, 
"  Mdse., 
"  Bills  Rec'ble, 
"  Mdse., 
"  L.  Fairbanks, 
"  Mdse., 
"  V.  M.  Rice, 
"  Amos  Dean, 

"  Mdse., 

II      II 

"  Fi.  B.  Rice, 
"  Mdse., 


"  J.  R.  Penn, 
"  Mdse., 


To  Balance, 


1200 
3000 

39 
250 

17 
375 

19 
500 

33 
350 
252 

30 

50 
234 
106 

42 
163 
138 
154 
250 

75 

7280 


5881 


50 


82 


50 


19 


94 


1S61 
July 


By  Expense, 


Mdse., 

Expense, 
II 

A.T.Stw.&Co 
II.  B.  Bryant, 
Expense, 


Bills  Payable 
Expense, 
A.T.Stw.&Co 
By  Balance, 


163 


a 

Dr. 


LEDQER-SET  III. 
Ij.    Fairbanks. 


Cr. 


1861 
July 

1 

To  H.  B.Bryant, 
To  Balance, 

1 

750 

1861 

July 

16 
31 

By  Cash, 
"   Balance, 

4 

350 
400 

150 

Aug 

1 

400 

Dr. 

JsAon.'zo 

Graston, 

Gr 

• 

1861 

July 

1 

ToH.B,  Bryant, 

1 

375 

1861 

July 

7 

By  Cash, 

2 

375 

Dr. 

Jbieai     H]stat^. 

Or 

• 

1861 

July 

1 

To  H.B.Bryant, 
To  Balance, 

1 

5000 

1861 
July 

31 

By  Balance, 

l3 

5000 

j 

Aug 

1 

5000 

D 

r. 

iilxpense. 

Cr 

• 

1861 

1861 

July 
)) 
II 

H 
>l 

II 
II 
11 
>1 

1 

2 

4 

7 

8 

19 

20 

21 

25 

To  Cash, 

11      11 

II      II 
II      II 
11      11 
II      II 
11      II 
11       n 
II       II 

1 
11 

2 

3 
II 

5 

11 

11 
6 

5 
10 

175 
25 
15 
15 
10 

183 
25 

75 

July 

31 

By  Loss  &  Gain 

1-6 

468 

T» 

^ , 

463 

75 

1    463 

1 

75 

_^ 

164 


LKOaER-SET  III. 


Dr. 

James    Jolmson. 

Ct 

1S61 

3 

To  Mdse., 
To  Balance, 

2 

192 

1S61 
July 

31 

By  Balance, 

l4 

192 

Aiig 

1 

192 

Dr. 

Clafliri 

L,    IVTellen 

&    Co. 

Cr 

• 

1861 
July 

15 

To  Bills  Payable 

4 

5*75 

1861 
July 

5 

By  Mdso., 

2 

575 

Dr, 

A..    T. 

Ste^vart 

&    Co. 

Cr 

• 

1861 

July 

I) 

10 
26 

To  Cash, 
II       II 

3 

7 

300 
457 

757 

1861 

July 

5 

By  Mdse., 

2 

757 

757 

Br. 

E.    B. 

!Rice. 

a 

1861 
July 

7 

To  Mdse., 

2 

42 

45 

1861 
July 

24 

By  Cash, 

6 

42 

45 

D 

r. 

BenjamirL    [Payn. 

Cr 

• 

1861 

July 

10 

• 

To  Mdse., 
To  Balance, 

3 

j      23 

41 

1861 
July 

31 

By  Balance, 

hi 

28 

41 

Aug 

1 

23 

41 

i 

165 


Dr. 


LEDGER -SET  III. 
Bills    Payable. 


Cr. 


1861 

July 
II 

25 
31 

To  Cash, 
"   Baiance, 

6 

l5 

'75 
575 

18G1 
July 

11 

12 
15 

ByH  D.Strat'n 
"  Claf.M.&Co. 

By  Balance, 

4 
l5 

75 
575 

650 

650 
575 

Aug 

1 

Dr. 

^mos    Deaii. 

Cr. 

1861 

July 

13 

To  Mdse., 
To  Balance, 

4 

180 

1861 

July 

1) 

21 
31 

By  Cash, 
"   Balance, 

5 
l5 

50 

180 

180 

180 

Aug 

1 

l5 

130 

Dr. 

"Victor    !M.    Hice. 

Cr. 

1861 
July 

20 

To  Mdse., 
To  Balance, 

5 

1 

82 

88 

1861 

July 
II 

20 
31 

By  Cash, 
"   Balance, 

5 

l5 

30 
62 

82 

88 

82 

88 

88 

Aug 

1 

l5 

52 

■ 

Dr. 

Jaines    Slielden. 

,      Cr. 

1S61 

July 

23 

To  Mdse., 
To  Balance, 

G 

132 

24 

1861 
July 

31 

By  Balance, 

T-5 

182 

24 

Aug 

1 

l5 

132 

24 

Dr.                "Williara    Sliepard. 

Cr. 

1861 
July 

25 

To  Jtdse., 
To  Balance, 

6 
l5 

37 

55 

1861 
July 

31 

By  Balance, 

l5 

37 

55 

Aug 

1 

37 

65 

166 


LEDGER -SET  III. 


6 


Dr, 

Jolm    Belden. 

Ct 

I 

1S61 
July 

26 

To  Mdae., 
To  Balance, 

l6 

216 

50 

1S61 
July 

31 

By  Balance, 

l6 

216     SO 

Aug 

1 

216 

50 

Dr, 

Cha's 

^ 

.    Seeley. 

Cv 

• 

ISGl 
July 

30 

To  Mdse., 
To  Balance, 

l6 

107 

40 

18C1   1 
July  '  31 

i 

By  Balance, 

1-6 

j   107 

40 

Aug 

1 

107 

40 

Dr, 

Loss 

and    < 

Grain. 

Ct 

• 

1861 
July 

1) 

31 

To  Mdse., 
"   Expense, 

Ll 

l3 

242 
463 

13 

75 

1861 
July 

31 

By  KB.  Bryant 
"  H.D.Strafn 

Ll 
Ll 

852 
362 

94 
94 

705 

88 

705 

88 

167 


STATEMENT. 


The  following  detailed  statement  should  be  carefully  compared 
with  the  Single  Entry  Statement  on  page  67,  that  the  charactei-istic 
features  of  the  two  systems  may  be  thoroughly  appreciated.  We 
have  designated  the  Real  and  Representative  accoimts  in  the  Trial 
Balance  and  have  included  all  the  Ledger  accounts,  that  the  general, 
footings  may  be  made  to  agree  with  the  footings  of  the  Journal. 
In  rendering  the  Statement,  those  accounts  which  cancel  or  balance, 
are,  of  course,  omitted.  With  this  form  of  Trial  Balance  it  would 
scarcely  be  necessary  to  do  more  than  carry  the  balances  of  the 
accounts  into  the  statement  columns  as  in  the  Statement  on  page 
121 ;  but  this  form  gives  the  philosophy  more  in  detail. 


Trial 

Balance. 

Total  Footingf 

. 

Balances. 

H.  B.  Bryant, 

Real, 

Br. 

Cr. 

Dr. 

Cr. 

1 

75 

9075 

9000 

2 

H.  D.  Stratton, 

Real, 

75 

8000 

7925 

3 

Merchandise, 

Rep., 

6109  50 

2867 

37 

3242 

13 

4 

Bills  Receivable, 

Real, 

2120!20 

500 

1620 

20 

5 

John  R.  Penn, 

Real,  {CaneeUd.) 

500 

500 

6 

Cash, 

Real, 

7280 

19 

1398 

25 

5881 

94 

7 

L.  Fairbanks, 

Real, 

750 

350 

400 

8 

Alonzo  Gaston, 

Real,  (^Canceled.) 

375 

375 

9 

Real  Estate, 

Rep., 

6000 

5000 

10 

Expense, 

Rep., 

463 

75 

463 

75 

11 

James  Johnson, 

Real,       * 

192 

192 

12 

Claf.,  Mellen  &  Co 

Real,  iCanceUd.) 

575 

575 

13 

A.  T.  Stewart, 

Real,  {Canceled.) 

757 

757 

14 

E.  B.  Rico, 

Real,  (Canceled.) 

42 

45 

42 

45 

15 

Benjamin  Tayn, 

Real, 

23 

41 

23 

41 

16 

Bills  Payable, 

Real, 

75 

650 

575 

17 

Amos  Dean. 

Real, 

180 

50 

130 

18 

Victor  M.  Rice, 

Real, 

82 

88 

30 

52 

88 

19 

James  Shelden, 

Real, 

132 

24 

132 

24 

20 

William  Shepard, 

Real, 

37 

55 

37 

55 

21 

John  Belden, 

Real, 

21€ 

50 

216 

50 

22 

Cha.s,  A.  Seeley, 

Real, 

107 

40 

07 

107 

]  17500 

40 

i25170j07j 

25170 

00; 

17500 

00 

Inventory, 

Mdse.  unsold,        $3000 

Real  Estate, 5000 

168 


STA.TEMENT. 

Losses  and  Gains* — Representative  Accounts. 


Merchandise, 
Expense^ 

Cost, 

Proc— Sales,  |2SGT  3T 

Value  unsold,  3000  00 

JTetlosa,     .    . 

Outlay  for  Expenses, 
Total  Net  Loss,  .  . 

n.  B.  Ka.,  1  net  loss,  . 
ir.D.Strat,     "      " 

$6109  50 
5867  37 

Losses. 

Gains. 

3 

2|2 
463 

13 

75 

705 

10 

$352  94 
352  94 

S3 

705 

88 

705 

88 

■ 

Resoiprces  and  Liabilities.^ — ^Real  Accounts. 


1.  From  Inventories  of  unsold  property. 

Mercoavdise,  .  ■  . 

Real  Estate, 

2.  From  Ledger  Accounts. 
Bills  Receivable,     others' notes  received,   $2120  20 


Cash, 


L.  Fairbanks, 


James  Johnson, 
Bexj.  Payn, 
Bills  Payable, 


Amos  Dean, 


Victor  M.  Eice, 


James  Siielden, 

\VlLLL\M  ShEPARD, 

John  Belden, 
CiiAS.  A.  Seeley, 
II.  B.  Bryant, 


H.  D.  Stratton, 


"         "     dis.  of, 

"         "on.  hand. 

Amount  received, .    . 

"       paid  out,  .    . 

■  "        on  hand,  .    . 

Our  %  against  him, 

I/is     "        "       us,    , 

He  owes  us,    ,    .    .    . 

Jle  mces  us,    ...    . 

Our  nates  issued,  ;    . 
"       "     redeemed, 
"       "     ouUtand'ff, 
Our  %  against  him. 
His     "       "       "US, 
He  oxces  us,    .    ,    . 
Our  "/c  against  him. 
His     "       "       us. 
He  oxces  us,    .  •  ,    . 


His  net  investment, 
"      "    loss,  ,    .    . 

IIlS  PBESKXT  INTERKST, 

Jlis  net  investment, 
"     "    loss,  .    .    . 

IIlS  PBBSENT  INTKBEST, 


500  00 


$7280  19 
1398  25 


$750  00 
350  00 


$650  00 
75-00 


$180  00 
50  00 


30  00 


$9000  00 
352  94 


$7925  00 
352  94 


Resources. 


3000 
5000 


1620 


5881 


400 

192 

23 


130 


52 
132 

37 
216 

107 


20 


94 


41 


16794  12 


im 


Liahilities. 


675 


8647 


7572 
16794 


06 


EXAMPLES    FOR    PRACTICE. 


The  following  examples  are  to  be  rendered  in  the  form  of  the 
Statement  on  page  169. 


Example  1. 


Trial  Balance. 


Dr. 


Cr. 


Warren  P.  Spencer,    (Partner,)    .     . 
J.  C.  Bryant,     .     .  do.        .     . 

Merchandise,     (Amount  unsold,  $5000,) 

Cash, 

Bills  Receivable,     .     .     .     .     .     . 

Bills  Payable, 

E.  G.  Folsom,     ...:... 

E.  R.  Felton, 

Expense, 


700 

12000 

15752 

4000 

9000 

VoO 

123 

175 


25 


75 


42501     00 


5724 
5024 
7594 
9692 
1500 
12000 

965 


42501 


58 
58 

84 


00 


Example  2. 


Trial  Balance. 


Dr. 


Cr. 


James  W.  Lusk,  (Partner,)  .  . 
H.  W.  Ellsworth,  do.  •  . 
H.  C.  Spencer,  .     .    do.         .     . 

Cash, 

Bills  Receivable, 

Merchandise,  (Inventory,  $1000,) 
Real  Estate,       (      do.         5000,) 

Expense,    .     .  ' 

Bills  Payable, 

Robert  Paton, 

Samuel  Ogden, 


398 

17594 
7500 
6794 
5000 
150 
4000 
2000 
1400 


44837  00  44837  00 


4500 
5000 
4500 
15329 
4300 
5382 
125 

5700 


50 
50 


QUESTIONS    FOR    REVIEW. 


EEMAKK3,  PAGE  154 
1.  What  is  the  purpose  of  Set  III  ?  2.  With  what  previous  set  does  it  correspond  ? 
3.  Where  is  the  distinction  between  Single  and  Double  Entry  most  apparent?  4. 
To  what  do  the  additional  accounts  in  Double  Entry  relate  ?  5.  For  what  are  they 
useful  ?  6.  What  improvement  has  this  set  over  Set  11  ?  7.  What  is  the  objection 
usually  urged  against  combining  the  Day  Book  and  Journal  ?  8.  What  is  tho 
general  purpose  of  auxiliary  books  ?  9.  For  what  are  they  used  in  Single  Entry  ? 
10.  In  what  does  the  method  of  closing  the  accounts  in  this  Ledger  differ  from  tho 
preceding?  11.  Is  it  usual  to  iring  down  single  items  in  the  Ledger?  12.  When 
is  this  proper  ? 

Note.— Let  this  aet  be  followed  by  the  "  Exerctoeo"  on  page  69. 

17J 


SET    lY. 


GENTLEMEN'S  FURNISHING  BUSINESS. 


(PARTNERSHIP.) 


JOURNAL,    CASH    BOOK,   AND    SALES    BOOK, 
USED  AS  PRINCIPAL  BOOKS. 


"SxxWvwe**  '^YO%\teYO\x». 


REMARKS. 


The  characteristic  feature  of  this  set  consists  in  the  peculiar 
arrangement  and  use  of  the  original  books  of  entry.  Hitherto  the 
transactions,  Avliatever  auxiliary  books  have  been  used,  have  all 
been  entered  in  the  Journal,  and  from  thence  posted  to  the  Ledger. 
This  plan,  although  having  some  advantages,  is  objectionable  upon 
the  ground  of  too  much  labor,  nearly  all  the  transactions  being 
entered  twice  or  more  before  being  carried  to  the  Ledger. 

The  i^lan  of  posting  directly  from  the  original  books  of  entry, 
such  as  the  Cash  Book,  Sales  Book,  etc.,  is  not  only  practical  and 
business-like,  but  serves,  in  the  most  striking  manner  to  enforce  the 
theory  of  the  science,  and  to  disarm  that  class  of  objectionists  who 
insist  that  Double  Entry  requires  vastly  more  writing  than  Single 
Entry. 

The  only  difficulty  in  the  way  of  posting  directly  from  the  original 
books  lies  in  the  danger  of  conflicting  the  entries,  or  posting  the 
same  amounts  twice.  For  instance,  the  debit  side  of  the  Cash  Book 
comprises  in  itself  a  double  entry,  Avhich  is  equivalent  to  the 
Journal  entry  "  Cash  Dr.  To  Sundries."'  In  posting  from  the  Cash 
Book,  the  total  of  the  debit  side  is  carried  to  the  Cash  account  in 
the  Ledger,  and  the  item  comprising  that  amount  to  the  credit  side 
of  the  various  accounts  mentioned,  among  which  is  Merchandise. 
It  is  very  evident  that  if  all  the  Merchandise  sold  be  credited  from 
the  Sales  Book,  the  amount  sold  for  cash  would  be  credited  ttoice, 
hence  the  necessity  of  an  extra  column  in  the  Sales  Book  for  Cash 
sales  Avhich  are  omitted  in  posting  from  the  Sales  Book.  The 
special  "  Mdse."  and  "  Expense  "  columns  in  the  Cash  Book  are  to 
save  the  necessity  of  so  many  special  entries  to  these  accounts  in 
the  Ledger.  The  method  of  posting  from  the  Cash  and  Sales 
Books  is  extremely  simple.  The  amounts  in  the  "  General "  column 
of  the  Cash  Book  may  be  posted  at  any  time — the  page  of  the 
Ledger  being  indicated  in  the  margin,  the  "Mdse."  and  "Expense" 
columns  at  the  end  of  the  month,  or  as  often  as  it  may  be  best  to 
close  the  Cash  Book.  The  sales  for  Cash  are  marked  "  C.B. "  in 
the  margin  of  the  Sales  Book,  and  the  amounts  extended  into  the 
"  Cash  "  colimm.  The  other  accounts  from  the  Sales  Book  may  be 
posted  at  any  time,  the  page  of  the  Ledger  being  indicated  in  the 
margin.  The  sales  for  notes  are  marked  inside  the  margin,  "B.R." 
and,  of  course,  posted  to  Bills  Receivable  account.  Instead  of  in- 
dicating the  page  from  which  the  transactions  are  posted,  the 
initials  of  the  original  book  are  giA'cn  in  the  Ledgei*. 

172 


JOURNAL -SET  IV. 

Chicago,  September  1,  1861. 


2 

Merchandise, 

6750 

i 

1 

To  J.  R.  Penn, 

6750 

1 

Am't  invested,  per  Inventory 

1750 

J.  R.  Penn, 

3 

To  Bills  Payable, 
Assumed  for  him, 

1750 

1 

Sundries,           To  J.  C.  Bryant, 

Atnounts  invested, 

5900 

1 

Bills  Rec'ble,  J.  Smith's  note,  1750  00 

1 

H.  Young's,   "      750  00 

1500 
500 

J.  T.  Calkins,  Balance  of  % 

2 

E.  R.  Fclton,         do. 

376 

2 

J.  H.  Goldsmith,     " 

1170 

2 

Jas.  Atwater,          " 

1250 

3 

1 

P.C.Schuyler, 

1104 
900 

J.  C.  Bryant,         To  Sundries, 

Liabilities  assuiqed, 

3 

To  Chas.  Taylor,  Bal.  of  %, 

500 

3 

J.  W.  Lusk, 

400 

3 

y.^       ■ 

400 

J.  W.  Lusk, 

3 

To  Bills  Payable, 
Our  note®  30  ds.  to  BaL  % 

400 

1 

Bills  Receivable, 

1104 

' 

3 

To  P.  C.  Schuyler, 

1104 

Hi^  note  ®  60  ds.  to  Bal.  % 

16804 

00 

16804    00 

_ 

i" 

1T3 


1861 


Casli. 


CASH  BOOK  - 
Dr. 


Sept. 
1 


2 

3 

II 

5 
7 
10 
12 
14 
15 
16 

17 

)i 

18 

22 

)i 

25 

II 

26 

ti 

27 
II 

28 
II 

29 


30 


S.  S.  Packard,  .     .  Am"t  Invested,    .    .    . 

Mdse. T.  W.  W.    Sales  Book, 

Mdso.,       ....  Petty  Sales.    P.  C.  B., 

J.  T.  Calkins,    .    .     On  %, 

Mdse. D.  V.  B.    Sales  Book,. 

Mdse.,       ....  Petty  Sales.    P.  C.  B., 

Mdse.,      ....  "       »           n      , 

Mdse. J.  A.    Sales  Book,  .    . 

James  At  water,     .     On  %, 

Mdse. Petty  Sales.     P.  C.  B., 

Mdse.,      ....  "        w            «      _ 
Mdse.^      .     .     . 
J.  T.  Calkins,     . 
Bills  Receivable, 


"W.  B.    Sales  Book,     .  ^ 

On%, 

J.  Smith's  note,  ;    .    .    , 


Interest,  ....     On  same, 

Mdse.,       ....  Petty  Sales.     P.  C.  B., 

J.  H.  Goldsmith,    .     On  % 

Mdse.,       ....  Petty  Sales.    P.  C.  B., 

E.  R.  Felton,     .     .     In  full, 

Mdse.,       ....  Petty  Sales.     P.  C.  B., 

Mdse. «        11           M      ^ 

J.  H.  Goldsmith,    ,     On  %, 

Mdse.,       ....  Petty  Sales.    P.  C.  B., 

James  Atwater,     .     On  %, 

Mdse.,       .     .     .     .  R.  McG.     Sales  Book, 

Mdse.,        ....  Petty  Sales.    P.  C.  B., 

Mdse.,      ....  "        "            "      _ 

Bills  Receivable,    .  n.  Young's  note,    .    . 

Interest,  ....     On  same, 

Mdse.,       ....  Petty  Sales.    P.  C.  B., 


Mdtt. 

363 
54 

89 

28 
105 
737 

58 
138 
128 


Total  to  Merchandise, 
Total  to  Cash,  .    .    . 


94 

112 

83 
58 

117 

156 

87 
112 

175 
2702 


72 
25 


90 


50 


25 


83 

44 

75 
94 

50 

75 
50 
94 


27 


174 


SET  IV. 


1861 

Cash. 

— 

( 

Jr. 

Sept. 

y 

Expense Postage  Stamps,  .... 

Expetive. 

General. 

1 

3 

2 

3 

Charles  Taylor, 

On%, 

300 

4 

y 

Expense, .     . 

2  Tons  Coal,  @  $5,  .    .    ; 

10 

6 

y 

Expense, .     . 

Bill  of  Stationery,    .    .    . 

15 

)i 

V 

Expense, .     . 

Hands,  for  Shop-work,     . 

160 

1 

2 

Mdse.,.    .     . 

Invoice  Clotbij.    J.  B.,     . 

3000 

10 

\/ 

Expense, .     . 

Gas  Bill, 

15 

13 

V 

Expense, .     . 

Hands,  for  Shop-work,     . 

175 

15 

3 

Bills  Payable, 

Our  note,  favor  II.  B., .    . 

1000 

)) 

3 

Interest,  .     . 

On  same, 

46 

75 

18 

^^ 

Expense, .     . 

Clerks'  Salaries,  .... 

112 

20 

^^ 

Expense, .     . 

Hands,  for  Shop-work,     . 

250 

25 

^^ 

Expense, .     . 

Rent  to  Sept.  80, .    .    .    . 

100 

26 

^^ 

Expense, .     . 

Porterage  and  Drayage,   . 

35 

28 

f^ 

Expense, .     . 

Hands,  for  Shop-work,     . 

275 

30 

V 

Expense, .    . 

Partners'  Salaries  to  date, 

606 

1746 

JbtaJ  to  Expense, 

Total  to  Cash, 

1746 

6092 

75 

Balance  ok  hand,    .    .    .    , 

6304 

27 

— 

-/ 

=r 

12397 

02 

175 


SALES  BOOK -SET  IV. 

Chicago,   September  1,  1861. 


^y 


^: 


Therox  W.  Woolson,  Mt.  Pleasant,  la. 

4  Doz.  Shirts.  2d  quality,  48  @  $1  00  $48  00 

6     "     Union  Neckties,    72  "         SS'?  27  36 

20  "     Linen   Ildkfs.,     240  "         50$  120  00 

3  pes.  Cassimere,  150  yds      "     1  23  187  50 

$382  86 
Disc,  off,  5%  19  14 


Ika  Packaed, 


JPeru,  Jnd., 


B.B. 


50  Boys'  overcoats,  ®  $5  50 

50     "  "  "     7  50 

Note  ®  6mo. 


$275  00 
•  375  00 


J 


D.V.Bell, 

1  Dress  suit  for  self, 
1  Overcoat  for  son, 
1  Box  Hdkfs.  6  doz. 


Chicago. 

$50  00 

15  00 

$4  00  24  00 


^ 


J.  H.  Goldsmith,  Detroit. 

2  pes.  Eng.  B'dc'tb,  100  yds  @  $4  00     $400  00 
50  Military  coats,  per  order,  "    10  00       500  00 


/ 


James  Allen, 


Dubuque. 


20  Zouave  uniforms,  @  $25  00    $500  00 

1  Pee.  Slri'd  Satin,  50  yds.  "       5  00       250  00 


Disc,  off  Satin,  @  5^ 

i ^£ 


$750  00 
12  50 


James  Atwater, 

1  Lot  ready  made  clothing  viz : 


10  Coats, 

20      " 

50      " 

8  Pair  Pants, 

25  " 

50  Vests, 

25       " 

1  Overcoat, 


@  $3  00 
3  50 
6  00 

3  00 

4  00 
1  50 
3  00 


J\fadiso7i. 


$30  00 
70  00 

250  00 
24  00 

100  00 
75  00 
75  00 
15  00 


176 


363 


72 


650 


I   89 


900 


737 


60 


1190 


22 


039 

2189!  00 


SALES  BOOK -SET  IV. 

Chicago,  September  15,  1861, 


2 


u 
u 


William  Bakek, 
6  doz.  Cravats,  60 
3     "         "  36 

9     "     Linen  Hdkfs.  108 


& 


AmounU  Forward, 

Spri7igfielcl. 

75*     $45  00 

$1  00  36  00 

50<f        54  00 


Disc.  off,Z% 


$135  00 
6  75 


J.  T.  Calkins,  North  Bend^  Ind. 

50  Military  C'ts,  (Privates)  ®  $10  00     $500  00 
5         "  "      (Officers)    "     15  00  75  00 

ya IZZIZ 


C.  D.  Bragdox, 

50  (Ready  made)  Coats,      @ 
100  prs.  Pants,  " 

50  doz.  Collars.  " 

5       "     P.  y.  Shirts,       60  " 
B.K.  Nolt  ®  07no. 

^ ^0 


Mock  Island. 

$5  GO  $250  00 
3  00  300  00 
1  50  75  00 

1  75        105  00 


George  E.  Harvey,  Green  Bay. 

100  Zouave  Uniforms,  <®  $20  00  $2000  00 
50  Mil  Coats,  "  Co.  H."       "      10  00        500  00 

B.B.  iVbfe  ®  60  ds. 

^S 


James  W.  Lusk,  -  Chicago. 

50 Unifms ("Line.  Green")®  $25  00  $1250  00 
30       "        (Zouaves)  "      15  00        450  00 

JS^ : ZHH 


Robert  McGrath,  White  Pigeon. 

20  (R'dy  made)  Boy's  C'ts,  @    $5  00     $100  00 
30      "         "       Vests,  "        1  50         45  00 

20  doz.  Collars,  "       1  00         20  00 


Disc,  offfi^ 

—30 


$165  00 
8  25 


E.  R.  Felton, 

75  Complete  Uniforms, 


®  $25  00 


Peoria. 


Sales  on  time,  to  credit  of  Mdse. 
Sales  for  Cash,  posted  from  C.B. 
Petty  Sales,  entered  alone  on  Cash  Book. 

ToM  Mdse.  sold, 

"^  177 


Cash. 


1190    22 


General. 
2189 


128 


25 


575 


730 


2500 


1700 


156 


76 


1875 


1475 
1227 


9569 

2702 
12271 


Dr. 


LEDQ-ER-SET  IV. 
8.    S.    Packard. 


Cr. 


1S61 
Sep. 


By  Cash, 


5000 


Dr. 


Jolm    R.    [Penn. 


Cr. 


Sep.      1  ToBillsPayable    J.     1T50 


1S61 

Sep.      1     By  'Mdse., 


6750 


Dr. 


J.    C.    Bryaiit. 


Or. 


1861 
Sep.      1 


To  Sundries, 


900 


1S61 
Sep.      1 


By  Sundries, 


5900 


Dr. 

Bills    [Receivable. 

Cr 

• 

1861 

1861 

1 

Sep. 

1 

To  J.  C.  Bryant, 

J. 

1500 

Sep. 

17 

By  Cash, 

CB 

750 

20 

"  P.C.Schuyler 

J. 

1104 

)i 

29 

II       II 

CB 

750 

)i 

1 

"  Mdse., 

SB 

650 

ji 

18 

»      )i 

SB 

730 

)! 

20 

)i      )i 

SB 

2500 

D. 

r. 

J. 

'1' 

.    Calkins. 

Cr 

• 

1861 
Sep. 

>i 

1 

15 

To  J.  C.Bryant, 
"  Mdse., 

J. 

SB 

500 
575 

1861 

Sep. 

II 

2 
16 

By  Cash, 

II      II 

CB 
CB 

200 
150 

• 

m 


Dr. 


LEDGER -SET  IV. 
Casli. 


Or, 


1S61 

Sep. 


30 


To  Sundries, 


12397 


02 


1861 

Sep. 


30 


By  Sundries, 


6092 


75 


Dr, 

IVJIercliaiidise. 

Cr 

• 

1S61 

1S61 

1 

Sep. 

1 

To  JT  R.  Penn, 

J. 

6750 

Sep. 

30 

By  Cash, 

cb' 

2702 

27 

7 

"  Cash, 

CB 

3000 

I) 

11 

"   Sundries, 

SB 

9369 

Dr. 

E. 

Ft. 

Felton. 

Cr 

• 

1861 

1861 

Sep. 

1 

To  J.  C.  Bryant, 

J. 

376 

Sep. 

25 

By  Cash, 

CB 

376 

30 

"  Mdse,, 

SB 

1875 

Dr. 

J. 

H. 

Groldsmith. 

Cr 

• 

1S61 
Sep. 

I 
5 

To  J.  C.  Bryant, 
"  iidsc.. 

J. 

SB| 

1170 
900 

1861 
Sep. 

I) 

22 
26 

By  Cash, 
11       )i 

CB 
CB 

1000 
170 

Dr. 


James    J^t^vater. 


Cr 


1361 

S^p. 


To  J.  C.  Bryant, 
"  Mdse., 


1250 
639 


1861 
Sep. 


By  Cash, 

II      II 


179 


750 
600 


8 


Dr 


LEDQER-SET  IV. 
P.    C.    Sclinyler. 


Cr, 


1S61 
Sep. 


1   To  J.  C.  Bryant, 


1104 


1661 
Sep. 


20 


By  Bills  Rec'ble 


1104 


Dr. 


Cliarles    Taylor. 


Cr, 


1861 
Sep.      2 


To  Cash, 


300 


1861 
Sep.      1 


ByJ.C.BryanC 


500 


Dr. 

Jaraes 

^W. 

L-Qsk. 

Cr 

• 

1861 
Sep. 

)> 

15 
25 

ToBillsPavable 
"  Mdse.,  ' 

J. 

SB 

400 
1700 

1S61 

Sep. 

.1 

By  J.  C.Bryant, 

J. 

400 

Dr. 

Bills 

I^ayable. 

Cr 

• 

1861 
Sep. 

15 

To  Cash, 

CB 

1000 

1861 
Sep. 

1 
15 

By  J.  R.  Penn, 
"    J.  W.Lusk, 

J. 
J. 

1750 
400 

Dr 


Interest. 


Cr. 


1861 
Sep. 

15 

To  Cash, 

CB 

46 

i 

75 

1861 

Sep. 

17 
29 

By  Cash, 
1)      )) 

CB 
CB 

34 
'      14 

1 
1 

25 
50 

180 


Dr. 


LEDGER -SET  IV. 
Expense. 


Cr, 


4 


1S61. 

Sep. 


30 


To  Cash, 


1746 


EXERCISES   FOR   THE   LEARNER. 


inoTIRTH       SERIES. 


The  following  routine  is  a  continuation  of  tho  business  of  Set  IV,  and  the 
transactions  should  be  entered  in  the  proper  books  and  posted  in  accordance  with 
the  plan  aid  instructions  of  the  Set,  using  the  eamo  books,  and  producing  at  tho 
close,  a  general  result  of  the  whole  business.  As  this  set  is  by  far  the  mo"t 
practical  in  tho  treatise,  it«  peculiar  points  should  be  thoroughly  impressed  upon 
the  mind.  The  student  should  exercise  much  care  in  the  symmetrical  arrange- 
ment of  tho  original  Books  of  Kntry.  The  accompanying  initials  will  indicate  the 
books  to  bo  written  up,  and  their  order. 

Memoranda. 
October  1.  Bo't  of  Dunlmm  &  Isrokaw  on  !%,  Invoice  of  Mdse. 
amounting  to  §6000,  (J.) — Sold  James  Johnson,  Freeport,  for  Cash, 
1  doz.  Fancy  Neckties,®  $1  each;  12  doz.  prs.  Lisle  Thread 
Stockings,  O  03  per  doz.,  (S.B.,  C.B.) — 2.  Paid  Shop-hands,  Cash, 
$300,  (C.B.)— Received  Cash  for  Petty  Sales,  $119,  (C.B.)— 3. 
Received  Cash  of  J.  II.  Goldsmith,  in  full  of  %,  $900,  (C.B.)— Sold 
E.  R.  Felton,  on  %,  6  doz.  French  Yoke  Shirts,  ®  $18  per  doz.; 
10  doz.  Knit  L^ndershirts,  @  $7  per  doz. ;  8  doz.  pr.  Knit  Drawers, 
®  $8  per  doz.,  (S.B.)— 5.  Received  Cash  for  Petty  Sales,  $120, 
(C.B.) — Sold  Kobertllarmer,  Vandalia,  for  Cash,  15  Summer  Coats, 
@  $2  ;  20  do.  Vests,  @  $1  50  ;  6  doz.  Cut-throat  Collars,  ®  $2  per 
doz.,  (C.B.)— 7,  Paid  Cash  for  repairing  store,  $150,  (C.B.)— 
Received  Cash  for  Petty  Sales,  $94  83,  (C.B.) — 8.  Received  Cash 
of  J.  T.  Calkins,  in  fuU  of  %,  $725,  (C.B.)— Sold  Jacob  Horn, 
Milwaukee,  on  his  note  @  GO  ds.,  50  Complete  Uniforms,  ®  $20, 
(S.B.)— Received  Cash  for  Petty  Sales,  $110,  (C.B.)— 9,  Paid  Shoi> 
hands.  Cash,  $297,  (C.B.)— Sold  J.  W.  Lusk,  on  %,  2 'doz.  Ready 
made  Coats,  24  @  $5  ;  15  prs.  Pants,  @  $3  75  ;  30  Vests,  ®  $2  ;  1 
Fine  Overcoat,  $25,  (S.B.) — 10.  Received  Cash  for  Petty  Sales, 
$119  50,  (O.B.)— 12.  Received  Cash  in  full  for  P.  C.  Schayler's 

181 


EXERCISES    FOR    THE    LEARNER. 

note,  $1104,  (C.B.) — 15.  Sold  Abraham  Jackson  for  Cash,  5  doz. 
Byron  Collars,  @  $2  per  doz. ;  4  doz.  D'Orsay  Cravats,  ®  $12  per 
doz.,  (S.B.,C.B,)— Received  Cash  for  Petty  Sales,  $157  30,  (C.B.) 
—16.  Paid  Dunham  &  Brokaw,  Cash  on  %,  $3000,  (C.B.)— Paid 
Shoi>hands,  Cash,  $263,  (C.B.) — Received  Cash  for  Petty  Sales, 
$85  90,  (C.B.)— 18.  Sold  E.  R.  Fclton,  on  %,  1  Case  Overalls,  6 
doz.  prs.  @  $6  per  doz. ;  2  Cases  Summer  Frocks,  12  doz.  ®  $18 
per  doz.,  (S.B.)— Received  Cash  for  Petty  Sales,  $115,  (C.B.)— 20. 
Received  Cash  of  E.  R.  Felton  on  %,  $1500,  (C.B.)— Sold  Robert 
C.  Spencer,  St.  Louis,  for  Cash,  10  Military  Coats,  ®  $15;  5  do. 
(officers,)  &  $25,  (S.B.,  C.B.)— Received  Cash  for  Petty  Sales,  $143, 
(C.B.)— 21.  Paid  Cash  for  salaries,  $117,  (C.B.)— Sold  Chas. 
Taylor,  on  %,  1  Piece  French  Cassimere,  50  yds.  @  $3,  (S.B.) 
Received  Cash  for  Petty  Sales,  $125,  (C.B.)— Paid  Dunham  & 
Brokaw,  Cash  in  fullof  %,  $3000,  (C.B.)— 23.  Paid  Shop-hands, 
Cash,  $375,  (C.B.)— Received  Cash  for  Petty  Sales,  $75,  (C.B.)— 
25.  Sold  James  Atwater,  on  %,  1  doz.  Boy's  Frocks,  12,  @  $2  ; 
3  doz.  do.,  36,  ®  $5,  (S.B.) — Received  Cash  for  Petty  Sales,  $85  90, 
(C.B.)— 27.  Received  Cash  of  James  Atwater,  in  full  of  %,  $843, 
(C.B.)— 28.  Paid  Cash  for  Gas  Bill,  $15  ;  Rent,  $100,  (C.B.)— 30. 
Paid  Shop-hands,  Cash  $400,  (C.B.) 


STATEMENT 


The  above  transactions  properly  entered  will  produce  the  follow- 
intr  result. 


S.  S.  Packard,  . 
J.  R.  Penn,  .  . 
J.  C.  Bryant,  . 
Bills  Receivable, 
Cash,  .... 
Merchandise,  . 
K  R.  Felion,  . 
Charles  Tavlor, 
J.  W.  Lusk,  . 
Bills  Payable,  . 
Interest,.  .  . 
Expense,      •    . 


Face  of  Ledger.   { 

Balances. 

I>r. 

c.    1 

Dr. 

Cr. 

5000 

5000 

1750 

6750 

5000 

SOO 

5900 

5000 

7484 

2604 

4880 

19272 

45 

14109 

75 

5162 

70 

15750 

16183 

95 

433 

95 

2743 

1876 

869 

450 

500 

50 

2361 

25 

400 

1961 

25 

1000 

2150 

1150 

46 

75 

48 

75 

2 

3763 

3763 

55522 

45 

55522 

45  : 

16635 

95 

16635 

95 

182 


PRACTICAL    HINTS 

FOR  TEACHER  AND  PUPIL. 


In  the  preparation  of  this  book  the  authors  have  kept  in  view  one  important 
feet,  viz:  that  iu  order  to  become  a  practical  accountant,  the  student  should  learn 
not  only  to  think  for  himedf,  but  to  give  his  thoughts  appropriate  form  and 
expression ;  hence  the  introduction  of  intermediate  "  Exercises  for  the  Learner," 
and  "  Examples  for  Practice,"  intended  to  throw  him  upon  his  own  resources,  and 
rescue  him  from  the  too  common  error  of  cop^-ing.  "We  feel  sure  that  this  feature  will 
commend  itself  to  all  who  use  the  book,  and  especially  to  the  faithful  teacher  who 
is  satisfied  with  no  progress  which  is  not  real  The  three  qualities  essential  to 
success  in  Accountantship  are,  1.  Accuracy  ;  2.  Neatness  ;  3.  Dispatch  ;  and 
these  are  to  be  acquired  only  through  practice.  Instead  therefore,  of  omitting  any 
of  the  practical  Exercises,  or  passing  lightly  over  them,  they  should  be  regarded  as 
vital  and  indispensable,  and  should  they  not  afford  sufficient  practice,  additional 
exercises  should  be  given  by  tho  teacher  or  self-imposed  by  the  student.  Tho 
limited  space  afforded  renders  it  impossible  to  carry  out  in  detail,  all  the  labor 
which  actual  business  would  require  in  the  way  of  filling  out  notes,  drafts,  checks, 
etc.,  or  to  suggest  appropriate  forms  for  such  letters  and  documents  as  would  ba 
necessary  in  conducting  the  business  represented ;  but  tlie  student  should  bo 
required  to  supply  this  deficiency,  with  such  aid  as  the  teacher  may  think  prudent 
to  offer. 

The  following  brief  hints  may  afford  some  assistance  in  carrying  out  tho  intentiea 
of  the  work. 

ORDER  AND  NEATNESS. 

There  is  no  error  more  fatal  to  tho  student  in  Accounts  than  the  impression 
which  so  generally  prevails,  that  a  theoretical  knowledge  of  general  principles  will 
prepare  him  for  the  duties  of  the  Counting  Room.  It  is  true  that  without  this 
knowledge,  he  need  never  hop3  to  succeed ;  and  equally  true  that  with  it,  akme, 
he  will  be  quite  as  unfortunate.  Although  in  enumerating  the  neccessary 
qualifications  of  an  Accountant  we  have  placed  neatxess,  seomd  iu  the  list,  it  is 
iho  first  which  attracts  attention,  and  is  of  the  utmost  importance  in  establishing  a 
reputation  for  practical  accountantship.  Neatnes.s,  in  Book-keeping  is  the  result  of 
good  writing  and  tasteful  arrangement.  It  is  a  mistaken  idea  conceived  by  ambitious 
youth  and  fostered  by  peripatetic  writing  masters,  that  the  ability  to  form  a  few 
wondrous  curves  in  the  execution  of  capital  letters,  or  thd  adornment  of  a  S&acj 

183 


PRACTICAL    HINTS. 

title  constitutes  the  chief  qualification  of  a  business  writer.  Practical  men  are 
not  apt  to  appreciate  qualilicatioas  of  this  kind,  but  insist,  gather,  ou  the  utmost 
modesty  of  display  and  simplicity  of  arrangement.  A  professional  flourish  is 
as  much  out  of  place  on  a  page  of  business  record,  as  a  daub  of  oil  color 
on  a  marble  statue.  Uniformit}',  legibility,  and  adaptation  to  space  and  pur- 
pose should  bo  the  characteristics  of  business  writing ;  and  he  who  fails  in 
these  essentials  will  need  something  more  than  a  certifleato  from  somo  professor  of 
the  art  to  save  him  from  just  condemnation.  These  strictures  are  not  in  disparage- 
ment to  any  style  or  system  of  penmanship,  nor  designed  to  underrate  the  profession 
which  lends  such  a  charm  to  our  thoughts  by  sotting  them  in  graceful  symbols ;  but 
to.  exalt  the  practical  above  the  fanciful;  and  to  insist  upon  a  proper  recognition  of 
the  standard  of  tjsto  which  the  experience  and  observation  of  business  men  havo 
adopted.  Eapidity  of  execution  is  an  essential  element  in  business  writing,  but 
even  this  should  bo  subordinated  to  neatness.  In  the  selection  of  script  for  the 
principiil  forms  in  Part  I.  reference  has  been  had  to  the  standard  of  neatness  above 
indicated.  It  is  not  expected  that  the  student  will  attempt  to  copy  the  style  of  the 
writing,  but  it  is  hoped  that  he  may  seek  to  emulate  its  legibility  and  taste  in 
arrangement.  Particularly  should  he  exercise  great  care  in  avoiding  errors  which 
will  uecessitato  erasures.  Isotliing  so  destroys  the  beauty  of  a  page  as  erasures  and 
interlineations.  Even  occasional  blotting  is  preferable  to  occasional  scratching. 
Where  it  is  possible,  errors  should  bo  corrected  by  counter  entries,  thus  affording 
an  explanation,  withouj;  destroying  the  harmony  of  the  page.  Finally  let  the 
student  practice  until  ho  becomes  proficient  in  ruling.  In  using  red  ink  great  caro 
should  be  had  to  keep  it  pure;  and  to  that  end,  it  is  never  allowable  to  use  a  pen 
that  has  been  dipped  in  black.  Even  steel  pons  are  thought  to  destroy  tho 
brilliancy  of  red  ink,  and  quills  are  preferred  on  that  account.  A  steel  pen,  however, 
is  the  best  for  ruling,  and  needs  only  to  bo  kept  perfectly  clean.  For  ruling  with 
a  common  steel  pen,  no  rule  is  so  convenient  as  the  round,  but  tj  use  it  skilfully 
requires  much  practice,  and  a  steady  hand. 

PROFICIENCY    IN    MATHEMATICS. 

The  processes  of  B(X<k-keeping  seldom  call  into  practice  the  higher  departments 
of  mathematics ;  albeit  a  thorough  mathematician — other  things  being  equal — will 
make  the  best  accountant.  The  kind  of  proficiency  most  available  to  a  Book-keeper 
is  facihty  and  accuracy  in  addition.  The  ability  to  add  long  columns  of  figures 
with  speed  and  certainty  is  one  of  tho  very  best  claims  a  j^oung  man  can  present 
for  a  position  of  trust.  So  highly  is  this  accomphshment  esteemed  by  business  men, 
that  where  it  is  wanting  other  qualifications  sink  intj  comparative  insignificance. 
A  clerk  who  "  never  makes  a  .mistake  "  is  sure  of  promotion  and  remuneration. 
There  are  many  theories  as  to  tho  surest  and  most  rapid  method  of  adding,  and 
occasionally  some  eccentric  genius  electrifies  the  world  with  an  exhibition  of  almost 
magical  power  in  this  direction ;  but  t!io  only  thing  that  can  Avith  safety  bo  relied 
UT^on  ia  practice — f.ithful  and  continued  ^roc^jce.  Tho  student  should  be  required 
to  write  down  long  columns  of  figures  of  various  numerical  values,  and  test  his 
powers  by  adding,  fir^t  in  one  direction  and  then  in  tho  other ;  occasionally  trying 
two  and  three  columns  at  a  time.  We  give  below  three  simple  processes  of  retaining 
tho  figure  to  be  carried — a  very  important  matter  with  beginners.  The  first  is  tho 
usual  method  of  writing  the  carrying  G.<xuTe  small  under  the  unit  amount  of  tho 

184 


PRACTICAL    HINTS. 

column  which  produced  it.  The  second  requires  the  addition  of  each  separate 
column  to  be  written  down  on  a  waste  space  commencing  with  the  right  hand 
column  and  carryiup^'lo  the  next  as  in  the  usual  method;'  these  separate  amounts 
placed  in  their  order  one  under  tfie  other  will  present  in  their  unit  figures,  counting 
upward,  the  general  result.  The  third  method  consists  of  the  proper  arrangement 
of  the  independent  sum  of  each  column,  so  that,  being  added,  the  proper  result  is 
Becured. 


First  ProceM. 

1829 

25 

743 

18 

2562 

28 

145 

19 

2823 

25 

7574 

28 

4291 

83 

25 

61 

19994 

90 

333 

a 

EXAMPLES. 

Second  Process. 

1st  column,     50 

2d 

29 

3d        " 

34 

4th       " 

39 

5th       " 

39 

6th      " 

19  994  90 

7%ird  Process. 
5 


19  9  9  4       9  0 


The  process  of  adding  two  or  more  columns  at  once  is  much  more  simple  than  is 
generally  supposed ;  requiring  little,  if  any,  more  skill  than  the  common  method 
The  only  point  of  difftculty  is  the  necessity  of  adding  units  to  units,  tens  to  tens, 
etc.  To  give  the  student  an  idea  of  the  process,  we  will  take  tlie  two  cent-columns 
in  the  above  example,  and  add  them  together.  Commencing  with  the  lower 
amount,  we  proceed:  64  and  3  are  67,  and  80  are  147,  and  8  are  155,  and  20  aro 
175,  and  5  aro  180,  and  20  aro  200,  and  9  aro  209,  and  10  aro  219,  and  8  are  227, 
and  20  are  247,  and  8  aro  255,  and  10  aro  265,  and  5  aro  270,  and  20  aro  290; 
'which  is  tho  sum  of  the  two  columns.  It  will  bo  seen  that  we  separate  each 
amount  into  units  and  tens,  adding  tho  units  to  tho  units  and  the  tens  to  tho  tens 
of  tho  accumuLiting  result.  "V\'e  will  now  vary  tho  process  by  commencing  at  th.o 
top  and  adding  downward;  and  also  by  adding  the  tens  first:  25  and  10  are  35, 
and  8  arc  43,  and  20  aro  G3,  and  8  aro  71,  and  10  are  81,  and  9  are  90,  and  20  aro 
110,  and  5  are  115,  and  20  aro  135,  and  8  aro  143,  and  80  aro  223,  and  3  are  226, 
a:il  60  are  233,  and  4  aro  290 ;  the  same  result  as  before.  By  continued  practice 
of  this  kind  the  student  will  soon  bo  able  to  astonish  himself  with  his  own  pro- 
ficiency. Let  him  practice  on  two  columns,  until  ho  becomes  thoroughly  familiar 
with  tho  process,  and  then  take  three,  and  four.  The  necessity  of  keeping  his  mind 
constantly  on  tho  alert  for  fear  of  adding  tens  to  units,  and  units  to  hundreds,  will 
serve  to  quicken  his  powers  of  concentration,  and  develop  tho  practical  resources 
of  his  miud. 


TO  DETECT  ERRORS  IN  THE  TRIAL  BALANCE. 

Undoubtedly  the  best  method  for  guarding  against  the  trouble  of  finding  errors  in 
the  Trial  Balance  is  not  to  make  them ;  but  as  this  advice  is  much  more  easily  given 
than  followed,  and  as,  in  despite  of  tho  best  efforts,  Trial  Balances  do  frequently 

185 


PRACTICAL    HINTS. 

fail  to  equilibrate,  a  few  hints  as  to  the  most  approved  methods  of  discovering  tlie 
errors  may  be  kindly  received.  In  the  first  place  let  it  bo  remembered  that  whilo 
the  Trial  Balance  is  not  a  swe  test  cf  the  correctness  of  the  Ledger,  no  Doublo 
Entry  Ledger  can  be  correct  that  does  not  balance;  hence,  the  necessity  of  knowing 
that  the  sides  are  equal.  The  Trial  Balance  is  simply  the  summing  up  of  the  debit 
and  credit  sides  of  the  Ledger  to  ascertain  if  they  are  equal.  If  the  trial  should 
prove  that  they  are  not  equal,  the  cause  must  exist  either  in  entries  being  omitted, 
posted  to  the  wrong  side,,  or  in  wrong  amounts.  A  little  observation  will  enable 
the  accountant  to  classify  the  error  under  one  of  the  above  heads.  If  the  precaution 
indicjftedin  our  first  Double  Entry  sets  bo  taken,  viz:  to  carry  tlio  total  amounts 
posted  into  the  Trial  Balance — and  either  side  agrees  with  the  footing  of  tho 
Journal  columns,  the  difficulty  is  easily  overcome,  aa  tho  differenco  between  tho 
sides  will  show  not  only  tho  error  or  combination  of  ciTors,  but  tho  side  of  tho 
Ledger  upon  which  they  occur.  For  various  reasons,  however,  it  is  not  always 
convenient  to  embrace  the  total  Ledger  entries  in  the  Trial  Balance: — therefore  for 
general  purposes,  wo  would  suggest  the  following  process  for  detecting  errors : 
First,  make  sure  that  an  error  exists.  It  is  often  the  case  that  an  overweening 
anxiety  to  have  tho  sides  of  the  Trial  Balance  equal  actually  produces  a  suppositious 
error,  by  dissipating  the  mind  while  engaged  in  ascertaining  tho  result,  and  thus 
persistenth"-,  though  erroneously  realizing  its  own  fears,  by  errors  in  addition.  If  an 
error  seerns  to  exist,  before  attempting  to  find  it,  go  carefully  over  tho  work  of 
addition,  proving  it  in  every  way.  If  the  test  should  provo  that  tho  sides  da,  not 
equal,  refer  to  the  Ledger  accounts,  and  ascertain  that  the  proper  amounts  havo 
been  transferred  to  tho  Trial  Balance.  Foot  up  the  accounts  very  carefully,  and 
permit  no  doubt  to  exist  that  tho  exact  condition  of  the  Ledger  is  sliown  in  tho 
Trial  Balance. — Second,  If  tho  error  still  exists,  ascertain  its  exact  amount,  and  then 
look  carefully  for  the  same  amount  in  tho  Journal,  which  may  have  been  omitted 
in  posting.  If  no  such  an  amount  should  appear,  or  should  not  prove  to  have  been 
omitted,  next  ascertain  if  any  Journal  Entry  exists  of /lay  tho  amount,  wliich  being 
posted  to  tlio  wrong  side  y,'on\d  produce  tho  dift'erenee.  Should  this  test  provo, 
unsuccessful,  ascertain  if  tho  differenco  bo  divisible  by  9,  and  if  so,  look  carefully 
for  a  transposition  of  somo  amount  posted.* — Third,  Should  this  process  fail  tho 
last  resort  is  to  checJc  the  postings.  First  ascertain  that  the  Journal  entries  balance 
and  then  go  carefully  over  tho  work,  checking  in  pencil  mark,  all  entries  that  havo 
been  properly  posted  both  on  tho  Journal  and  tho  Ledger.  Tho  most  reliable  pro- 
cess of  checking  is  to  havo  ono  person  tako  tho  Journal  and  call  off  the  Ledger 
titles  and  amounts,  slowly  and  distinctly — the  debits  first,  and  credits  next — whilo 
another  examines  the  Ledger  entries  to  seo  if  they  correspond.  Many  practical 
accountants  adopt  tho  plan  of  tlms  checking  before  attempting  to  take  a  Trial 
Balance,  for  the  purpose,  not  only  of  facilitating  the  labor  but  of  being  assured  that 
the  Ledger  is  absolutely  correct.  We  cordially  commend  the  practice,  believing 
that  if  it  is  adopted,  and  faithfully  carried  out  there  will  be  little  need  of  resorting 
to  any  other  method  to  ensure  a  balance.  Above  all,  let  the  student  hunt  up  his  own 
errors  of  balance ;  for  whilo  it  is  true  that  all  such  errors  are  tho  result  of  careless- 

•  It  ts  a  curious  fact  that  the  difTerence  botween  any  given  amount  composed  of  two  or  more 
fli^ures,  and  the  same  fignres  transposed.  Is  divisible  by  9.  For  example,  the  difTerence  between 
71  and  .5T  is  18;  between  120  and  210.  90;  between  195  and  1.59,  3fi  ;  etc..  all  of  which  differences 
18.  90,  and  86.  are  divisible  by  nine,  without  a  remainder.  The  illustration  maybe  carried  to 
any  extent,  with  the  same  results. 

186 


PRACTICAL    HINTS. 

nesa,  the  adoption  of  means  to  detect  them,  will  tend,  in  the  greatest  degree  to 
perfect  his  mind  in  those  practical  questions  and  labor,  necessary  to  the  full 
development  of  hia  powers.  It  is  the  duty  of  the  teacher  to  open  up  to  the  pupil's 
mind  the  bearings  of  the  various  principles  of  the  science  he  would  inculcate,  as 
well  as  to  aid  him  in  the  application  of  those  principles;  hnt  practical  res«te  should 
be  the  student's  own  work.  For  these  he  should  be  held  responsible  ;  and  should 
never  be  allowed  to  fall  into  the  loose  habit  of  making  errors  that  his  teacher  may 
find  them. 

RESOURCES  AND  LIABILITIES. 

These  terms  are  used  extensively  in  this  work,  and  their  importance  in  properly 
defining  the  condition  of  the  business  has  been  forcibly  set  before  the  student.  He 
has  been  taught  that  certain  Ledger  accounts  are  used  to  show  resources,  and  cer- 
tain others  to  show  liabilities,  and  that  the  correspondence  between  the  resources 
and  liabilities  thus  shown  must  agree  in  a  certain  sense,  with  the  accounts  showing 
gains  and  losses.  Any  careful  observer,  however,  must  be  aware  that  all  classes 
of  resources  are  not  equally  valuable ;  and  that,  in  the  course  of  trade,  persons  may 
become  indebted  to  us  both  on  note  and  account  who  will  never  pay ;  the  resource 
thus  represented  being  absolutely  valueless.  In  estimating  the  condition  of  a  con- 
cern, therefore,  it  is  well  to  know  whether  the  books  are  truthful  •  that  is  whether 
the  resources  exhibited  on  their  pages  are  absolute  or  fictitious.  (The  liabilities  aro 
always  presumed  to  be  genuine.)  The  importance  of  this  precaution  will  bo 
apparent  when  we  consider  that  all  gains  in  business,  as  shown  by  representative 
accounts,  are  predicated  upon  the  integrity  of  the  resources.  For  instance,  suppose 
we  sell  A,  $500  worth  of  Merchandise,  and  take  his  note  for  it.  In  recording  the 
transaction,  we  credit  Merchandise,  and  debit  Bills  Receivable.  In  estimating  our 
gains  and  losses,  we,  of  course  include  among  the  proceeds  of  Merchandise  this 
amount,  which  adds  $500  to  our  gains.  Our  Merchandise  account  is  closed,  and 
the  result  finds  its  way  into  the  Loss  and  Gain  account,  thus  having  an  important 
bearing  upon  the  apparent  prosperity  of  the  business.  But  suppose  this  note  should 
prove  worthless.  It  is  now  evident  that  the  $500  credited  to  Merchandise  account 
was  not  a  legitimate  product,  and  that  all  gains  predicated  upon  it  are  necessarily 
fictitious.  But  there  are  other  resources  represented  in  the  Ledger,  the  exact  value 
of  which  is  uncertain, — they  may  bo  worth  their  face,  or  half  of  it,  or  nothing.  How 
shall  they  be  treated  in  a  general  exposition  of  affairs?  Should  we  consider  them 
all  valueless,  and  close  them  into  Loss  and  Gain,  the  error  may  bo  as  great  as  to 
permit  them  to  remain  and  represent  actual  worth.  The  most  approved  method 
of  disposing  of  this  class  of  accounts,  is  to  permit  them  to  remain  upon  the  Ledger, 
but  to  neutralize  their  effect  by  opening  an  account  showing  fictitious  Uabilities  of 
the  same  amount  An  appropriate  title  for  this  account  is  "  Suspense."  When 
tliorefore  doubtful  resources  exist  on  our  Ledger,  and  wo  do  not  wish  to  represent 
anything  more  than  aciao^  gains,  the  process  should  bo  to  debit  Loss  and  Gain,  and 
credit  "Suspense"  with  the  amount  of  the  doubtful  resources.  If  any  of  these  aro 
afterwarfls  paid,  or  their  value  becomes  tangible,  it  is  very  easy  to  restore  them  by 
debiting  Suspense  and  crediting  Loss  and  Gain.  This  method  is  far  preferable  to 
the  more  usual  one  o?  closing  up  all  doubtful  accounts  into  Suspense.  The  Suspenso 
account  in  the  latter  case  would  represent  eitlier  a  loss  or  a  resource.  If  a  loss  tho 
amount  may  as  well  go  at  once  to  tho  Loss  and  Gain  account ;  and  if  a  resource,  it 

187 


EXCHANGE. 

had  much  better  remain  under  its  own  more  appropriate  title.  But  the  cliief 
objection  to  this  course  would  be  the  exhibiting  of  accounts  as  closed,  which  are 
yet  owing  and  may  be  paid.  If  Mr.  A,  for  instance,  whom  we  tlius  consider 
doubtful,  should  desire  to  see  his  account  in  our  Ledger,  that  he  may  pay  it,  it 
might  be  awkward  to  inform  him  that,  having  considered  his  account  worthless  we 
had  carried  it  to  Loss  and  Gain.  He  might  not  desire  to  change  our  estimate  of 
the  value  of  hia  indebtedness. 


EXCHANGE. 

Exchange  is  a  term  used  to  denote  that  commercial  usage  by  which  individuals 
are  enabled  to  cancel  debts  at  a  distance  without  the  transmission  of  money.  This 
is  effected  through  a  species  of  commercial  paper  known  as  "Bills  of  Exchange." 

A  Bill  of  Exchange  is  a  written  order  addressed  to  a  person  directing  the  pay- 
ment of  a  certain  sum  of  money,  either  upon  its  presentation,  or  at  a  specified  time 
thereafter.     There  are  two  classes  of  Exchange,  domestic  and  foreign. 

Domestic  Exchange  consists  of  drafts,  notes,  checks,  certificates  of  deposits,  etc., 
the  parties  to  which  reside  in  the  same  country. 

FOREIGX  Exchange  is  usually  represented  by  drafts,  the  parties  to  which  reside 
in  different  countries.  They  are  usually  drawn  in  sets  of  three  or  more,  one  of 
which  being  honored,  the  others  become  void.  The  separate  bills  are  sent  by 
different  routes,  or  at  different  times,  and  the  first  that  comes  to  hand,  if  either,  is 
honored.  Foreign  Bills  of  Exchange  are  made  payable  in  the  currency  of  the 
country  upon  which  they  are  drawn,  instead  of  that  where  they  originate. 

FORM  OF  A  SET  OF  EXCHANGE. 

Exchange  for  £1000.  Mw  York,  July  1,  1861. 

Ten  days  after  sight  of  this  mj  Jirsi  Bill  of  Exchange,  (second  and  third  of  same 
date  and  tenor  unpaid)  pay  to  S.  S.  Packard  or  order,  One  Thousand  Pounds  Ster- 
ling, value  received,  with  or  without  further  advice. 

H.  D.  Stkatton. 
To  George  Pea  body  &  Co.    ) 
Bankers,  London.  J 

Exchange  fob  £1000.  New- York,  July  1,  1861. 

Ten  days  after  sight  of  this  my  second  Bill  of  Exchange,  (first  and  third  of  same 
date  and  tenor  unpaid)  pay  to  S.  S.  Packard  or  order.  One  Thousand  Pounds  Ster- 
ling, value  received,  with  or  without  further  advice. 

H.  D.  Stratton. 
To  George  Peabody  &  Co.    ) 
Bankers,  London.  ) 

188 


EXCHANGE. 

ExcHANOE  FOR  £lOOO.  Kew-Tork,  July  1,  1861. 

Ten  days  after  sight  of  this  my  third  Bill  of  Exchange,  (first  and  second  of  same 
dale  and  tenor  unpaid)  pay  to  S.  S.  Packard  or  order,  One  Thousand  Pounds  Ster- 
Img,  value  received,  with  or  without  further  advice. 

H.  D.  Steatton. 
To  George  Peabody  &  Co.    ) 
Bankers,  London.  ) 

FORMS  OP  NOTES,  DRAFTS,  CHECKS,  ETC. 

The  following  forms  of  notes,  drafts,  checks,  receipts,  etc.,  comprise  the  great 
bulk  of  business  paper  entering  into  the  various  departments  of  domestic  trade. 

Notes. 

1.  Individual  Note. 
$500.  ,  New-York,  July  1, 1861. 

One  day  after  date,  I  promise  to  pay  M.  B.  Scott  or  order.  Five  Hundred  Dollars, 
value  received. 

Jacob  Hinds. 

2.  Joint  Kote. 
$1000,  Buffalo,  May  1,  1861. 

Sixty  days  after  date,  we  promise  to  pay  N.  C.  "Winslow,  or  order,  at  New-York 
and  Erie  Bank,  One  Thousand  Dollars,  value  received. 

J.  C.  Bryant, 
W.  P.  Spencer. 

3.  Joint  and  Several  Note,  (with  interest.) 
$1500,  Cleveland,  January  10,  1861. 

One  month  after  date,  we  or  either  of  us  promise  to  pay  John  R.  Penn  or  order, 
Fifteen  Hundred  Dollars,  value  received  with  interest  from  date, 

E.  G.  FoLSOM, 
E.  R.  Felton, 

4,  Principal  and  Surety  Note. 
$600,  Chicago,  July  IQ  1861. 

Thirty  days  after  date,  I  promise  to  pay  James  Richards  or  order,  Six  Hundred 
Dollars,  value  received. 

H.  B.  Bryant,  Principal. 
E.  B,  Rockwell,  Surety. 

B,  Chattel  Note. 
$400.  Detroit,  April  12,  1861. 

Three  months  fix)m  date,  for  value  received,  I  promise  to  pay  to  John  Jones  or 
order,  Four  Hundred  Dollars,  in  Pine  Lumber,  at  the  then  market  rate,  the  same  to 
be  delivered  as  per  his  order,  within  the  limita  of  the  city  of  Detroit 

Henry  P.  Smith. 

189 


EXCHANGE. 

6.  NoTt-negotiahle  Note. 
$375.  Albant,  June  10,  1861. 

One  month -from  date,  I  promise   to   pay  James  Cruikshank,  Three   Hundred 
and  Seventy  Five  Dollars  at  his  office. 

"W.  H.  Clark. 

Drafts. 

1.  Time  reckoned  Jrom  sight 
$500.  Philadelphia,  June  12,  1861. 

At  ten  days'  sight,  pay  to  the  order  of  Daniel  Slote,  Five  Hundred  Dollars,  value 
received,  and  charge  to  account  of 

L.  Faiebasks. 
To  PACKARn  &  Penn,    ) 
18  Cooper  Inst  N.Y.    J 

2.  Reckoned  from  Date. 
$T50.  WASm.KGTOK,  D.C.  April  28,  1861. 

Ten  days  after  date,  pay  to  Austin  Packard  or  order,  Seven  Hundred  and  Fifty 
Dollars,  value  received,  and  charge  to  my  account. 

ZaLMON  RiCHARDa 

To  Itison,  Phinket  &  Co,  ) 


48  Walker  St.,  N.Y. 


Due  Bills. 


1.  For  Cash,  Drawing  Interest 
$1'75  f*oV  St.  Louis,  July  1,  18G1. 

Due  Henry  C.  Spencer,  on  demand,  One  Hundred  and  Seventy  Five  yW  Dollars, 
with  interest  from  date. 

WiL  H.  Beebe, 

2.  For  Merchandise,  without  Interest 
$100.  Cincinnati,  June  12,  1861. 

Due  R.  M.  Bartlett,  One  Hundred  Dollars,  payable  in  Wheat,  at  market  price,  on 
the  first  day  of  September  next. 

William  Moobk. 

Orders. 

1.  To  apply  on  Account. 

Baltimore,  April  12,  1861. 
Mr.  J.  Aodtin  Sperry  will  please  pay  to  the  bearer,  Fifty  Dollars,  in  Merchandise, 
on  my  account 

J.  D.  HiNDB. 

190 


EXCHANGE 

2.  In  fuU  of  Account. 

Geanville,  0.,  Sept.  10,  1861. 
Thomas  Pease,  Esq. 

Please  pay  to  John  McDonald  or  bearer.  One  Hundred  Dollars,  from  your  storey 
and  this  shall  be  your  receipt  m  full  of  my  account. 

James  G.  Irwin. 

Receipts. 

1.  On  Account. 
$400. — Receired,  January  1,  1861,  Four  Hundred  Dollars,  on  account  of  James  "W. 
Lusk.  S.  C.  GEIGGS  &  Co. 

2.  In  full  of  aU  demands. 

$575.  Rochester,  June  19,  1861. 

Received  of  Geo.  W.  Eastman,  Five  Hundred  and  Seventy-five  Dollars,  in  full  of 
all  demands. 

D.  W.  Fish, 

3.  To  apply  on  Contract. 

$1000.  Syracuse,  Jan.  12,  1861. 

Received  of  S.  M.  Bassett,  One  Thousand  Dollars,  the  same  to  apply  on  contract 
for  building  house,  dated  Jan.  1,  1861. 

Robert  'Wallace. 

4.  To  apply  as  an  Endorsement. 
$T5.  July  10,  1861. 

Received  on  the  within  note.  Seventy-five  Dollars. 

Jakes  Suith. 

6.  Receipt  for  Property. 

New-York,  Jan.  15,  1861. 
Received  of  Duncan  Phyfe,  the  following  enumerated  articles  to  be  held  in  trust 
for  him,  and  returned  on  his  demand :  one  Gold  Watch  (Hunting  case),  two  Pro- 
missory notes,  each  dated  Jan.  1,  1861,  and  signed  by  William  Prentiss — one  for 
Three  Hundred  Dollar?,  due  in  six  months  from  date,  and  one  for  Five  Hundred 
Dollars,  due  in  eight  mouths  from  date. 

S.  S.  Packard. 

Checks. 

1.  Payable  to  Bearer. 

$100.  Mercantile  Bank,  Nkw-Tork,  i/by  10,  1861. 

Pay  to  John  Doo  or  Bearer,  One  Hundred  Dollars. 
(No.  1963.)  Peter  Cooper. 

2.  PaTjable  to  Order. 

$300.  Mercantile  Bank,  New-Tork,  April  10, 186L 

Pay  to  Charles  Strong  or  Order,  Three  Hundred  Dollars. 

Peter  Coopkr. 
191 


EXCHANGE. 


Certificate  of  Deposit. 


$500.  ExcHAXGE  Bank,  Albany,  March  1.  1861. 

J.  T.  Calkins  has  deposited  in  this  Bank,  Five  Hundred  Dollars,  payable  to  C.  G. 
Conant  or  Order,  ou  return  of  this  certificate. 
(Xo.  1900.)  Chas.  Eddy,  TeOer. 


QUESTIONS   FOR    REVIEW. 


EEMAEKS,  PAGE  1T2. 

1.  In  what  consists  the  peculiarity  of  Set  lY  ?  2.  How  have  the  transactions 
been  entered  heretofore  ?  3.  What  objection  to  entering  all  the  transactions  in  the 
Journal  ?  4.  "What  advantage  in  posting  from  the  original  books  of  entry  ?  5. 
What  difficulty  in  the  way  ?  6.  How  do  you  avoid  posting  certain  entries  twice  f 
1.  When  are  the  amounts  in  the  "  General  "  column  to  be  posted  ?  8.  When  the 
special  columns  ?  9.  What  reference  is  made  in  the  Ledger  to  the  book  from 
which  the  several  amounts  are  posted  ? 

PRACTICAL  HINTS,  PAGE  183. 

10.  What  ttree  qualificationa  are  necessary  to  good  accountantship?  11.  How 
are  these  to  be  acquired?  12.  In  what  does  neatness  in  Bookkeeping  consist? 
13.  What  are  tiie  characteristics  of  good  business  writing?  14.  What  is  said  of 
rapidity?  15.  What  of  errors  and  omissions  ?  16.  Interlineations  and  Erasures? 
17.  What  precautions  should  be  observed  in  the  use  of  red  ink?  18.  What  kind 
of  mathematical  proficieacy  is  most  available  to  the  Bookkeeper?  19.  How  is 
facility  in  addition  to  be  acquired  ?  20.  What  is  the  process  of  adding  two  or 
three  columns  at  once  ?  21.  What  is  the  best  method  of  avoiding  the  difficulties  in 
getting  a  Trial  Balance  ?  ,  22.  Is  the  Trial  Balance  a  sure  test  of  the  correctness  of 
the  Ledger  ?  23.  What  is  a  Trial  Balance  ?  24.  Will  you  give  the  processes  for 
discovering  an  error  in  the  Trial  Balance  ?  25.  What  curious  fact  connected  with 
the  transposition  of  figures  ?  26.  Wliat  plan  is  recommended  to  guard  against 
fictitious  gains'!  21.  What  does  the  "  Suspense  "■  account  show?  28.  What  is 
meant  by  Exchange?  29.  What  is  a  Bill  of  Exchange  ?  30.  Of  what  doe.« 
Domestic  Exchange  consist?  31.  Foreign  Exchange?  32.  How  are  Foreign 
bills  drawn  ?    33.  Wliy  in  Sets?    34.  In  what  currency  are  they  payable  ? 


192 


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